A challenging problem in neural crest development is to understand how a migratory population of multipotent stem cells gives rise to a diverse array of differentiated cell types in the correct spatiotemporal manner. There is now ample evidence that this process involves the generation of postmigratory progenitor cells present in a variety of neural crest targets. When individual progenitors are challenged by instructive growth factors they are able to produce neural and non-neural cells, raising the question of how fate restrictions appropriate to a given embryonic location are regulated in multipotent postmigratory progenitor cells. Although some of the extracellular cues involved have been identified, it is likely that fate decisions in progenitor cells are controlled by the combinatorial action of multiple environmental signals. Moreover, cell type specificity is thought to be regulated by an interplay between extracellular and intracellular cues. We are just beginning to unravel some of the mechanisms that allow the context-dependent integration of cell-extrinsic and cell-intrinsic signals in multipotent progenitor cells.