Development of the vertebrate eye is a complex process that requires interaction of several key transcription factors. One of them is the paired-like homeobox-containing gene Rx. Rx belongs to a small, conserved family of genes that displays an almost identical expression pattern in all of the vertebrate species. We have found that Rx is essential for normal eye development and its misexpression has profound effects on eye morphology. Xenopus embryos injected with Rx RNA develop ectopic retinal tissue and display hyperproliferation in the neuroretina. Mouse embryos carrying a null allele of this gene do not form optic cups and consequently do not develop eyes. No markers of eye development are expressed in these embryos suggesting that retinal progenitor cells do not form in the absence of Rx function. Since Rx is a key component in formation of vertebrate eyes, we propose four specific goals related to its function in eye development: Specific Aim 1: Analysis of the ability of cells lacking Rx function to contribute to normal retinal structures. For this purpose, we will make chimeric mouse embryos from Rx-/- and wild type cells. This experiment will determine whether Rx-/- cells can contribute to normal eye development in the presence of wild type cells. Specific Aim 2: Identification of the molecular mechanism that regulates the spatial and temporal expression of Rx genes. Rx regulatory elements will be identified using reporter constructs. Specific Aim 3: Effect of FGF signaling on the specification and survival of retinal cells. For this purpose dominant negative FGF receptors will be expressed in the developing retina using Rx regulatory sequences. Effects of elimination of FGF signaling on the development of retinal cell types will be monitored. Specific Aim 4: Manipulation of gene expression in the Xenopus retina in order to study development and differentiation. This will be achieved by a targeted expression of specific proteins in the retinal progenitor cells of transgenic Xenopus using the Rx regulatory region. Specific attention will be paid to the Otx2 and Xbarl homeobox-containing genes.