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The coupling between cell-cycle exit and onset of differentiation is a common feature throughout the developing nervous system, but the mechanisms that link these processes are mostly unknown. Although the transcription factor Pax6 has been implicated in both proliferation and differentiation of multiple regions within the central nervous system (CNS), its contribution to the transition between these successive states remains elusive. To gain insight into the role of Pax6 during the transition from proliferating progenitors to differentiating precursors, we investigated cell-cycle and transcriptomic changes occurring in Pax6 (-) retinal progenitor cells (RPCs). Our analyses revealed a unique cell-cycle phenotype of the Pax6-deficient RPCs, which included a reduced number of cells in the S phase, an increased number of cells exiting the cell cycle, and delayed differentiation kinetics of Pax6 (-) precursors. These alterations were accompanied by coexpression of factors that promote (Ccnd1, Ccnd2, Ccnd3) and inhibit (P27 (kip1) and P27 (kip2) ) the cell cycle. Further characterization of the changes in transcription profile of the Pax6-deficient RPCs revealed abrogated expression of multiple factors which are known to be involved in regulating proliferation of RPCs, including the transcription factors Vsx2, Nr2e1, Plagl1 and Hedgehog signaling. These findings provide novel insight into the molecular mechanism mediating the pleiotropic activity of Pax6 in RPCs. The results further suggest that rather than conveying a linear effect on RPCs, such as promoting their proliferation and inhibiting their differentiation, Pax6 regulates multiple transcriptional networks that function simultaneously, thereby conferring the capacity to proliferate, assume multiple cell fates and execute the differentiation program into retinal lineages.