The formation of functional neural circuits that process sensory information requires coordinated development of the central and peripheral nervous systems derived from neural plate and neural plate border cells, respectively. Neural plate, neural crest and rostral placodal cells are all specified at the late gastrula stage. How the early development of the central and peripheral nervous systems are coordinated remains, however, poorly understood. Previous results have provided evidence that at the late gastrula stage, graded Wnt signals impose rostrocaudal character on neural plate cells, and Bone Morphogenetic Protein (BMP) signals specify olfactory and lens placodal cells at rostral forebrain levels. By using in vitro assays of neural crest and placodal cell differentiation, we now provide evidence that Wnt signals impose caudal character on neural plate border cells at the late gastrula stage, and that under these conditions, BMP signals induce neural crest instead of rostral placodal cells. We also provide evidence that both caudal neural and caudal neural plate border cells become independent of further exposure to Wnt signals at the head fold stage. Thus, the status of Wnt signaling in ectodermal cells at the late gastrula stage regulates the rostrocaudal patterning of both neural plate and neural plate border, providing a coordinated spatial and temporal control of the early development of the central and peripheral nervous systems.