Multipotential stem cells throughout the developing central nervous system have common properties. Among these is expression of the intermediate filament protein nestin and the brain fatty acid binding protein (B-FABP). To determine if common mechanisms control transcription in CNS stem cells, the regulatory elements of these two genes were mapped in transgenic mice. A 257 basepair enhancer of the rat nestin gene is sufficient for expression throughout the embryonic neuroepithelium. This enhancer contains two sites bound by the class III POU proteins Brn-1, Brn-2, Brn-4, and Tst-1. Only one of the two POU sites is required for CNS expression. An adjacent hormone response element is necessary for expression in the dorsal midbrain and forebrain. The regulatory sites of the B-FABP gene are strikingly similar to those of the nestin gene. A hybrid POU/Pbx binding site is recognized in vitro by Pbx-1, Brn-1 and Brn-2. This site is essential for expression in most of the CNS. In addition, a hormone response element is necessary for forebrain expression. Both the nestin and B-FABP genes therefore depend on POU binding sites for general CNS expression, with hormone response elements additionally required for activity in the anterior CNS. These data indicate that regulation by POU proteins and hormone receptors is a general mechanism for CNS stem cell-specific transcription.