Fibroblast growth factors (FGFs) secreted from the midbrain-rhombomere 1 (r1) boundary instruct cell behavior in the surrounding neuroectoderm. For example, a combination of FGF and sonic hedgehog (SHH) can induce the development of the midbrain dopaminergic neurons, but the mechanisms behind the action and integration of these signals are unclear. We studied how FGF receptors (FGFRs) regulate cellular responses by analyzing midbrain-r1 development in mouse embryos, which carry different combinations of mutant Fgfr1, Fgfr2, and Fgfr3 alleles. Our results show that the FGFRs act redundantly to support cell survival in the dorsal neuroectoderm, promote r1 tissue identity, and regulate the production of ventral neuronal populations, including midbrain dopaminergic neurons. The compound Fgfr mutants have apparently normal WNT/SHH signaling and neurogenic gene expression in the ventral midbrain, but the number of proliferative neural progenitors is reduced as a result of precocious neuronal differentiation. Our results suggest a SoxB1 family member, Sox3, as a potential FGF-induced transcription factor promoting progenitor renewal. We propose a model for regulation of progenitor cell self-renewal and neuronal differentiation by combinatorial intercellular signals in the ventral midbrain.