The mechanisms underlying astrocyte heterogeneity in the developing mouse brain are poorly understood. The bHLH transcription factor Olig2 is essential for motoneuron and oligodendrocyte formation; however, its role in astrocyte development remains obscure. During cortical development, Olig2 is transiently expressed in immature developing astrocytes at neonatal stages and is progressively downregulated in astrocytes at late postnatal stages. To assess the function of Olig2 in astrocyte formation, we conditionally ablated Olig2 in a spatiotemporally controlled manner. In the Olig2-ablated cortex and spinal cord, the formation of astrocytes in the white matter is severely compromised. Temporally controlled mutagenesis revealed that postnatal Olig2 function is required for astrocyte differentiation in the cerebral white matter. By contrast, astrocytes in the cortical gray matter are formed, but with sustained GFAP upregulation in the superficial layers. Cell type-specific mutagenesis and fate-mapping analyses indicate that abnormal astrocyte formation is at least in part attributable to the loss of Olig2 in developing astrocytes and their precursors. Thus, our studies uncover a crucial role for Olig2 in white matter astrocyte development and reveal divergent transcriptional requirements for, and developmental sources of, morphologically and spatially distinct astrocyte subpopulations.