To understand how signaling molecules regulate the generation of neurons from proliferating stem cells and neuronal progenitors in the developing and regenerating nervous system, we have studied neurogenesis in a model neurogenic epithelium, the olfactory epithelium (OE) of the mouse. Our studies have employed a candidate approach to test signaling molecules of potential importance in regulating neurogenesis and have utilized methods that include tissue culture, in situ hybridization and mouse genetics. Using these approaches, we have identified three distinct stages of stem and transit amplifying progenitor cells in the differentiation pathway of olfactory receptor neurons (ORNs) and have identified mechanisms by which the development of each of these progenitor cell types is regulated by signals produced both within the OE itself and by its underlying stroma. Our results indicate that regulation of olfactory neurogenesis is critically dependent on multiple signaling molecules from two different polypeptide growth factor superfamilies, the fibroblast growth factors and the transforming growth factor beta (TGF-beta) group. In addition, they indicate that these signaling molecules interact in at least two important ways: first, opposing signals converge on cells at specific developmental stages in the ORN pathway to regulate proliferation and differentiation; and second, these signaling molecules--particularly the TGF-betas and their antagonists--play key roles in feedback loops that regulate the size of progenitor cell pools and thereby neuron number, during development and regeneration.