Neurons of the cochleovestibular ganglion (CVG) transmit hearing and balance information to the brain. During development, a select population of early otic progenitors express NEUROG1, delaminate from the otocyst, and coalesce to form the neurons that innervate all inner ear sensory regions. At present, the selection process that determines which otic progenitors activate NEUROG1 and adopt a neuroblast fate is incompletely understood. The transcription factor SOX2 has been implicated in otic neurogenesis, but its requirement in the specification of the CVG neurons has not been established. Here we tested SOX2's requirement during inner ear neuronal specification using a conditional deletion paradigm in the mouse. SOX2 deficiency at otocyst stages caused a near-absence of NEUROG1-expressing neuroblasts, increased cell death in the neurosensory epithelium, and significantly reduced the CVG volume. Interestingly, a milder decrease in neurogenesis was observed in heterozygotes, indicating SOX2 levels are important. Moreover, fate-mapping experiments revealed that the timing of SOX2 expression did not parallel the established vestibular-then-auditory sequence. These results demonstrate that SOX2 is required for the initial events in otic neuronal specification including expression of NEUROG1, although fate-mapping results suggest SOX2 may be required as a competence factor rather than a direct initiator of the neural fate.