Signaling molecules regulating development of the midbrain and anterior hindbrain are expressed in distinct bands of cells around the midbrain-hindbrain boundary. Very little is known about the mechanisms responsible for the coherence of this signaling center. One of the fibroblast growth factor (FGF) receptors, Fgfr1, is required for establishment of a straight border between developing mid- and hindbrain. Here we show that the cells close to the border have unique features. Unlike the cells further away, these cells express Fgfr1 but not the other FGF receptors. The cells next to the midbrain-hindbrain boundary express distinct cell cycle regulators and proliferate less rapidly than the surrounding cells. In Fgfr1 mutants, these cells fail to form a coherent band at the boundary. The slowly proliferating boundary cells are necessary for development of the characteristic isthmic constriction. They may also contribute to compartmentalization of this brain region.