During mouse neocortical development, the Wnt-β-catenin signaling pathway plays 
essential roles in various phenomena including neuronal differentiation and 
proliferation of neural precursor cells (NPCs). Production of the appropriate 
number of neurons without depletion of the NPC population requires precise 
regulation of the balance between differentiation and maintenance of NPCs. 
However, the mechanism that suppresses Wnt signaling to prevent premature 
neuronal differentiation of NPCs is poorly understood. We now show that the HMG 
box transcription factor Tcf3 (also known as Tcf7l1) contributes to this 
mechanism. Tcf3 is highly expressed in undifferentiated NPCs in the mouse 
neocortex, and its expression is reduced in intermediate neuronal progenitors 
(INPs) committed to the neuronal fate. We found Tcf3 to be a repressor of Wnt 
signaling in neocortical NPCs in a reporter gene assay. Tcf3 bound to the 
promoter of the proneural bHLH gene Neurogenin1 (Neurog1) and repressed its 
expression. Consistent with this, Tcf3 repressed neuronal differentiation and 
increased the self-renewal activity of NPCs. We also found that Wnt signal 
stimulation reduces the level of Tcf3, and increases those of Tcf1 (also known 
as Tcf7) and Lef1, positive mediators of Wnt signaling, in NPCs. Together, these 
results suggest that Tcf3 antagonizes Wnt signaling in NPCs, thereby maintaining 
their undifferentiated state in the neocortex and that Wnt signaling promotes 
the transition from Tcf3-mediated repression to Tcf1/Lef1-mediated enhancement 
of Wnt signaling, constituting a positive feedback loop that facilitates 
neuronal differentiation.