Phospholipase C is a key enzyme of intracellular signal transduction in the central nervous system. We and others recently discovered a novel class of phospholipase C, phospholipase Cepsilon, which is regulated by Ras and Rap small GTPases. As a first step toward analysis of its function, we have examined the spatial and temporal expression patterns of phospholipase Cepsilon during mouse development by in situ hybridization and immunohistochemistry. Around embryonic day 10.5, abundant expression of phospholipase Cepsilon is observed specifically in the outermost layer of the neural tube. On embryonic day 12 and later, it is observed mainly in the marginal zone of developing brain and spinal cord as well as in other regions undergoing neuronal differentiation, such as the retina and olfactory epithelium. The phospholipase Cepsilon-expressing cells almost invariably express microtubule-associated protein 2, but hardly express nestin or glial fibrillary acidic protein, indicating that the expression of phospholipase Cepsilon is induced specifically in cells committed to the neuronal lineage. The expression of phospholipase Cepsilon persists in the terminally differentiated neurons and exhibits no regional specificity. Further, an in vitro culture system of neuroepithelial stem cells is employed to show that abundant expression of phospholipase Cepsilon occurs in parallel with the loss of nestin expression as well as with the induction of microtubule-associated protein 2 expression and neuronal morphology. Also, glial fibrillary acidic protein-positive glial lineage cells do not exhibit the high phospholipase Cepsilon expression. These results suggest that the induction of phospholipase Cepsilon expression may be a specific event associated with the commitment of the neural precursor cells to the neuronal lineage.