Nuclear LIM domain-only proteins (LMOs), which consist of two closely spaced 50 amino acid Zn2+-finger protein interaction modules mediate interactions between several classes of transcription factors important for development. LMO2 is necessary for development of the entire hematopoietic system and overexpression of LMO1 or LMO2 results in human acute T cell leukemia. LMO4 is the most widely expressed LMO but its normal function is unknown. During development, LMO4 is expressed in dividing neuroepithelial cells within the ventricular zone along the entire rostrocaudal axis of the nervous system. In telencephalic and spinal cord regions of the CNS, LMO4 is highly expressed in ventral but is low in dorsal proliferating neuroepithelial cells. To understand the role of LMO4 during mouse development, we generated a homozygous null mutation in the gene. We found that LMO4 is required for proper closure of the anterior neural tube. In the absence of LMO4, elevation, bending, and proliferation of the ventral neural epithelium and consequent fusion of the prospective dorsal ends of the neural tube do not occur. LMO4 mutant mice die embryonically and exhibit exencephaly, which is associated with abnormal patterns of cell proliferation and with high levels of apoptotic cell death within the neuroepithelium. LMO4 is thus essential for normal patterns of proliferation and for survival of neural epithelial cells in the rostral neural tube. LMO4 is also expressed in Schwann cell progenitors after these contact neurites, a process mediated in part by neuregulin (Nrg).