The striatum plays a key role in normal brain function and in a number of disease processes, yet the molecular control of its development remains obscure. Recently, progress has been made due to the discovery of transcription factors, such as the Dlx genes, whose expression patterns suggest that they are important regulators of striatal development. Indeed, mice lacking both Dlx-1 and Dlx-2 have a time-dependent block in migration out of the striatal proliferative zones. Histological analysis of the Dlx-1/Dlx-2 mutant striatum on the day of birth (P0; also the day these mutants die) reveals an abnormal periventricular region of undifferentiated appearing cells, and a striatum-like region that is enriched for markers of the striatal patch compartment. Interestingly, the mutant periventricular region contains an abnormal overlap of dividing cells and cells immunoreactive for the post-mitotic neuronal marker, MAP2. This abnormality is first detectable at embryonic day 13.5 (E13.5). Two methods were used to determine that post-mitotic cells begin accumulating in the mutant striatal proliferative zone during the latter part of embryonic development. First, BrdU birthdating experiments revealed that cells born at E11.5 migrate into the differentiated portion of the mutant striatum by P0. However, most cells labeled at E15.5 remain within the mutant proliferative zone. Second, the study of migrating cells in slice cultures produced a similar result. The development of this migration abnormality in the Dlx-1/Dlx-2 mutants correlates with the emergence of the subventricular zone (SVZ) as the dominant proliferative population within the striatal anlage. In addition, the expression of several transcription factors is absent or abnormal in the mutant SVZ. These results suggest that differentiation within the striatal SVZ is disrupted in the mutants, and support the hypothesis that the striatal matrix compartment derives from the SVZ.