Our previous studies showed that presenilin-1 (PS1) is required for murine neural and skeletal development. Here we report that the reduction in the neural progenitor cells observed in the PS1-/- mouse brain is due to premature differentiation of progenitor cells, rather than to increased apoptotic cell death or decreased cell proliferation. In the ventricular zone of PS1-/- mice, expression of the Notch1 downstream effector gene Hes5 is reduced, and expression of the Notch1 ligand Dll1 is elevated, indicating reduced Notch signaling. These results provide direct evidence that PS1 is involved in the regulation of neurogenesis and Notch signaling during development.