CHX10 and VSX1 are homeodomain (HD) proteins essential for normal retinal development. CHX10 is required first for retinal progenitor cell proliferation and later for bipolar cell differentiation, whereas VSX1 is important in the terminal differentiation of a subset of bipolar cells. Elucidating the transcriptional activity of CHX10 and VSX1 is required to understand how these factors control retinal development. We show that CHX10 and Vsx1 can function as transcriptional repressors. When tethered to a promoter by a heterologous LexA DNA-binding domain or its HD, CHX10 repressed multiple classes of activators in different immortalized cell lines. CHX10 blocked TATA-containing and TATA-less promoters, repressed at a distance, and inhibited a complex enhancer positioned upstream or downstream of the reporter gene, whereas retinoblastoma protein (RB) inhibited the downstream enhancer only. Interestingly, CHX10 mildly potentiated a subset of activators in chick neuronal cultures. Thus, CHX10 is both a versatile repressor and a context-specific weak activator. The CHX10 HD and CVC domains were sufficient for DNA binding and repression. VSX1 contains closely related homeo and CVC domains and, like CHX10, also repressed transcription. A VSX1 HD mutation, R166W, that impairs DNA binding and causes keratoconus in humans, hindered repressor function. Therefore, CHX10 and VSX1 may control retinal bipolar cell specification or differentiation by repressing genes required for the development of other cell types.