Developmental control of gene expression often results from the coupling of growth arrest with the establishment of differentiation programs. QR1 is a gene specifically expressed in retinas during the late phase of embryogenesis. At this stage neuroectodermal precursors have reached terminal mitosis and are undergoing differentiation into distinct cell types. Transcription of the QR1 gene is tightly regulated during retinal development: this gene is expressed between embryonic day 9 (ED9) and ED17 and is completely repressed at hatching in quail. Moreover, QR1 transcription is downregulated when postmitotic neural retina cells are induced to proliferate by pp60v-src. We studied the stage-dependent transcriptional control of this gene during quail neural retina (QNR) cell development. Transient transfection experiments with QR1/CAT constructs at various stages of development showed that a region located between -935 and -1265 bp upstream of the transcription start site is necessary to promote transcription in retina cells during the late phase of embryonal development (QNR9, corresponding to ED9). By in vivo footprinting assays we identified at least two elements that are occupied by DNA-protein complexes in QNR cells: the A and B boxes. The A box allows formation of several biochemically distinct complexes: C1, C2, C3, and C4. Formation of the C2 complex mainly during early stages (ED7) and of C2, C3, and C4 complexes during postnatal life correlates with repression of QR1 transcription, whereas the C1 complex is strongly induced at ED11 when the QR1 gene is expressed. We previously showed that C1 was involved in downregulation of QR1 transcription by pp60v-src. Several complexes are also formed on the B box. We show that these complexes are exclusively present in neural tissues and that they involve members of the POU family of transcription factors. Mutations of each one of the two regions which abolish the binding of the C1 factor(s) on the A box and of the POU factor(s) on the B box also prevent stimulation of QR1 transcription in QNR9. Therefore, both elements appear to be required for the stage-specific transcription of the QR1 gene. We also show that the regulatory region from position -1265 to position -935 is able to confer stage-specific transcription upon a heterologous promoter (thymidine kinase). Indeed, this region stimulates transcription in differentiating retinas (QNR9) and represses transcription in terminally differentiated retinas (QNR17, corresponding to postnatal life). Our results suggest that cell growth regulation and developmental control are coordinated through the A and B boxes in regulating QR1 transcription during retinal differentiation.