To gain new insights into the transcriptional regulation of cortical development, we examined the role of the transcription factor Sp8, which is downstream of Fgf8 signaling and known to promote rostral cortical development. We have used a binary transgenic system to express Sp8 throughout the mouse telencephalon in a temporally restricted manner. Our results show that misexpression of Sp8 throughout the telencephalon, at early but not late embryonic stages, results in cortical hypoplasia, which is accompanied by increased cell death, reduced proliferation, and precocious neuronal differentiation. Misexpression of Sp8 at early developmental stages repressesCOUP-TF1expression, a negative effector of Fgf signaling and a key promoter of posterior cortical identity, while ablation of Sp8 has the opposite effect. In addition, transgenic misexpression ofCOUP-TF1resulted in downregulation ofSp8, indicating a reciprocal cross-regulation between these 2 transcription factors. Although Sp8 has been suggested to induce and/or maintainFgf8expression in the embryonic telencephalon, neitherFgf8norFgf15was upregulated using our gain-of-function approach. However, misexpression of Sp8 greatly increased the expression of Fgf target molecules, suggesting enhanced Fgf signaling. Thus, we propose that Sp8 promotes rostral and dorsomedial cortical development by repressingCOUP-TF1and promoting Fgf signaling in pallial progenitors.