The vertebrate forebrain is patterned during gastrulation into telencephalic, retinal, hypothalamic and diencephalic primordia. Specification of each of these domains requires the concerted activity of combinations of transcription factors (TFs). Paradoxically, some of these factors are widely expressed in the forebrain, which raises the question of how they can mediate regional differences. To address this issue, we focused on the homeobox TF Six3.2. With genomic and functional approaches we demonstrate that, in medaka fish, Six3.2 regulates, in a concentration-dependent manner, telencephalic and retinal specification under the direct control of Sox2. Six3.2 and Sox2 have antagonistic functions in hypothalamic development. These activities are, in part, executed by Foxg1 and Rx3, which seem to be differentially and directly regulated by Six3.2 and Sox2. Together, these data delineate the mechanisms by which Six3.2 diversifies its activity in the forebrain and highlight a novel function for Sox2 as one of the main regulators of anterior forebrain development. They also demonstrate that graded levels of the same TF, probably operating in partially independent transcriptional networks, pattern the vertebrate forebrain along the anterior-posterior axis.