Habenular nuclei play a key role in the control of motor and cognitive behavior, processing emotion, motivation, and reward values in the brain. Thus, analysis of the molecular and cellular mechanisms underlying the development and evolution of this region will contribute to a better understanding of brain function. TheFgf8gene is expressed in the dorsal midline of the diencephalon, close to the area in which the habenular region will develop. Given that Fgf8 is an important morphogenetic signal, we decided to investigate the role of Fgf8 signaling in diencephalic development. To this end, we analyzed the effects of altered Fgf8 expression in the mouse embryo, using molecular and cellular markers. Decreasing Fgf8 activity in the diencephalon was found to be associated with dosage-dependent alterations in the epithalamus: the habenular region and pineal gland are reduced or lacking inFgf8hypomorphic mice. Actually, our findings indicate thatFgf8may be the master gene for these diencephalic domains, acting as an inductive and morphogenetic regulator. Therefore, the emergence of the habenular region in vertebrates could be understood in terms of a phylogenetic territorial addition caused byde novoexpression ofFgf8in the diencephalic alar plate. This region specializes to permit the development of adaptive control of the motor function in the vertebrate brain.