Mice with a null mutation of the presenilin 1 gene (Psen1(-/-)) die during late intrauterine life or shortly after birth and exhibit multiple CNS and non-CNS abnormalities, including cerebral hemorrhages and altered cortical development. The cellular and molecular basis for the developmental effects of Psen1 remain incompletely understood. Psen1 is expressed in neural progenitors in developing brain, as well as in postmitotic neurons. We crossed transgenic mice with either neuron-specific or neural progenitor-specific expression of Psen1 onto the Psen1(-/-) background. We show that neither neuron-specific nor neural progenitor-specific expression of Psen1 can rescue the embryonic lethality of the Psen1(-/-) embryo. Indeed neuron-specific expression rescued none of the abnormalities in Psen1(-/-) mice. However, Psen1 expression in neural progenitors rescued the cortical lamination defects, as well as the cerebral hemorrhages, and restored a normal vascular pattern in Psen1(-/-) embryos. Collectively, these studies demonstrate that Psen1 expression in neural progenitor cells is crucial for cortical development and reveal a novel role for neuroectodermal expression of Psen1 in development of the brain vasculature.