Neural retina can be isolated from mouse embryos and maintained in culture for 2-3 weeks. In such retinal explant cultures, precursor cells differentiate into neurons and glial cells and form three cellular layers, mimicking well the normal development. This explant culture system is suitable for genetic manipulation, such as retrovirus-mediated gene transfer. Retroviral vectors can efficiently transfer genes into retinal precursors, and the copy of the viral genome is precisely transmitted to the progeny of infected cells. Thus, this is an excellent method to change stably the phenotypes of dividing cells. It has been shown that retroviruses carrying transcription factor genes efficiently change the fates of infected cells. Bicistronic expression by retroviral vectors is useful to test the effects of various combinations of many transcription factors. With this method, the transcriptional codes for retinal cell type specification are now being elucidated. Thus, retrovirus-mediated gene transfer to the retinal explant culture system offers a powerful and unique tool to analyze the molecular mechanism of neural development.