Early development of the rostral forebrain (RF) in vertebrates is accompanied by the inhibition of two homeobox regulators, Otx2 and Pax6 in the rostral sector of the anterior neural plate, further giving rise to the RF. However, the precise molecular mechanism and meaning of this inhibition is still obscure. We now demonstrate that the activity of the Anf homeodomain protein is necessary and sufficient for the anterior inhibition of Otx2 and Pax6. Specifically, we show that knockdown of the Xenopus laevis Anf, Xanf, by antisense morpholino oligonucleotides results in the anterior expansion of Otx2 and Pax6 expression into the presumptive RF territory. Furthermore, by overexpressing hormone-inducible activator- and repressor-fused variants of Xanf in the absence of protein synthesis, we present evidence that Xanf can directly downregulate Otx2 and Pax6 but not the more rostrally expressed Bf1, Bf2, Fgf8 and Nkx2.4. These results explain how the inhibitory activity of Xanf can discriminate RF regulators in favor of posterior forebrain ones. Assuming that the Anf type of homeobox is specific for vertebrates, our data suggest that the emergence of Anf in evolution could be a critical event for RF development in vertebrates through the elimination of homologues of modern posterior forebrain regulators from the rostral sector of the anterior neural plate. © 2007 Elsevier Inc. All rights reserved.