The developing vertebrate retina produces appropriate ratios of seven phenotypically and functionally distinct cell types. Retinal progenitors remain multipotent up until the last cell division, favoring the idea that extrinsic cues direct cell fate. We demonstrated previously that fibroblast growth factor (FGF) receptors are necessary for transduction of signals in the developing Xenopus retina that bias cell fate decisions (S. McFarlane et al., 1998, Development 125, 3967-3975). However, the precise identity of the signal remains unknown. To test whether an FGF signal is sufficient to influence cell fate choices in the developing retina, FGF-2 was overexpressed in Xenopus retinal precursors by injecting, at the embryonic 16-cell stage, a cDNA plasmid encoding FGF-2 into cells fated to form the retina. We found that FGF-2 overexpression in retinal precursors altered the relative numbers of transgene-expressing retinal ganglion cells (RGC) and Müller glia; RGCs were increased by 35% and Müller glia decreased by 50%. In contrast, the proportion of retinal precursors that became photoreceptors was unchanged. Within the photoreceptor population, however, we found a twofold increase in rod photoreceptors at the expense of cone photoreceptors. These data are consistent with an endogenous FGF signal influencing cell fate decisions in the developing vertebrate retina.