Sensory and autonomic neurons of the vertebrate peripheral nervous system are derived from the neural crest. Here we use the expression of lineage-specific transcription factors as a means to identify neuronal subtypes that develop in rat neural crest cultures grown in a defined medium. Sensory neurons, identified by expression of the POU-domain transcription factor Brn-3.0, develop from dividing precursors that differentiate within 2 days following emigration from the neural tube. Most of these precursors generate sensory neurons even when challenged with BMP2, a factor that induces autonomic neurogenesis in many other cells in the explants. Moreover, BMP2 fails to prevent expression of the sensory-specific basic helix-loop-helix (bHLH) transcription factors neurogenin1, neurogenin2 and neuroD, although it induces expression of the autonomic-specific bHLH factor MASH1 and the paired homeodomain factor Phox2a in other cells. These data suggest that there are mitotically active precursors in the mammalian neural crest that can generate sensory neurons even in the presence of a strong autonomic-inducing cue. Further characterization of the neurons generated from such precursors indicates that, under these culture conditions, they exhibit a proprioceptive and/or mechanosensory, but not nociceptive, phenotype. Such precursors may therefore correspond to a lineally (Frank, E. and Sanes, J. (1991) Development 111, 895–908) and genetically (Ma, Q., Fode, C., Guillemot, F. and Anderson, D. J. (1999) Genes Dev. 13, in press) distinct subset of early-differentiating precursors of large-diameter sensory neurons identified in vivo.