Transplantation studies suggest that the laminar fates of cerebral cortical neurons are determined by environmental signals encountered just before mitosis. In ferret, E29 progenitor cells normally produce neurons of layers 5 and 6. When transplanted during S-phase into an older ventricular zone, E29 progenitors produce neurons that change their fates and migrate to layer 2/3; however, cells transplanted later in the cell cycle migrate to their normal deep-layer positions even in an older environment (McConnell and Kaznowski, 1991). Here we utilize three culture systems to investigate the nature of the environmental signals involved in laminar specification. E29 cells were first cultured at low density to ascertain whether cell contact and/or short-range cues are required for deep layer specification. Neurons transplanted after a short time in low-density culture failed to adopt their normal fates and migrated instead to the upper layers. When crude cell contacts were restored by pelleting E29 cells together, most transplanted neurons cells became specified to their normal deep layer fates. Finally, E29 cells were transplanted after being cultured in explants that maintained the architecture of the cerebral wall. Explants allowed normal deep layer specification to occur, as transplanted cells migrated to layers 5 and 6. These results suggest that short-range cues induce multipotent progenitors to produce deep layer neurons.