Although Pax6 is known to be important for development of multiple eye tissues (Quinn et al., 1996) little is known of its targets or method of action in the eye. Using chimeras between small eye and wildtype mouse embryos this study has preliminary shown that retinal pigment epithelium (RPE) can be specified in mutant cells of the chimera although these cells do not differentiate to produce pigment. Trp2 and micropthalmia (Mi), both RPE specific genes, are expressed in this mutant tissue. These preliminary data indicate a possible function for Pax6 in RPE differentiation. Secondly this thesis reports the identification of Dach1, a murine homologue of dac. Two domains of high sequence conservation exist, the more C-terminal of which appears to represent a novel zipper motif. Similarity to the Ski family of genes is also seen within these regions suggesting that Dach1 belongs to a super-family including the Ski genes. Dach1 is expressed in the eye and the limb, structures affected by the Drosophila loss of function mutant, and also in the CNS, ear, nasal mesenchyme, lung, gut, genital eminence and dermomyotome. Pax6 expression overlaps but is not identical to Dach1 expression and the data presented here suggest that Dach1 expression is not affected in the small eye mouse brain. In addition Dach1 maps to 14E3 in the mouse. Three zebrafish dac homologues were also isolated: zfDachA, zfDachB and zfDachC. zfDachA is expressed in the eye, CNS, optic vesicle, lateral mesoderm and somites. zfDachB is found in an extremely restricted pattern in the CNS while zfDachC is expressed in the CNS, gut and blood islands. At the sequence level zfDachC is closest to Dach1 while zfDachB is the least similar. Injection of zfDachA RNA into 2-16 cell zebrafish embryos led to the formation of ectopic tissue in the midbrain/hindbrain region and to somite defects. Injection of a C-terminally truncated zfDachA also led to somite defects.