Pax3 is a transcription factor that is required by pre-migratory neural crest cells, which give rise to the peripheral nervous system, melanocytes, some vascular smooth muscle, and numerous other derivatives [corrected]. Both mice and humans with Pax3 deficiency exhibit neural crest-related developmental defects [corrected]. Pax3 is also expressed in the dorsal neural tube, and by myogenic progenitors in the presomitic mesoderm and the hypaxial somites. Molecular pathways that regulate Pax3 expression in the roof plate probably represent early upstream signals in neural crest induction. We have identified an enhancer region in the Pax3 genomic locus that is sufficient to recapitulate expression in neural crest precursors in transgenic mice. We show that Tead2, a member of the Tead box family of transcription factors, binds to a neural crest enhancer and activates Pax3 expression. Tead2, and its co-activator YAP65, are co-expressed with Pax3 in the dorsal neural tube, and mutation of the Tead2 binding site in the context of Pax3 transgenic constructs abolishes neural expression. In addition, a Tead2-Engrailed fusion protein is able to repress retinoic acid-induced Pax3 expression in P19 cells and in vivo. These results suggest that Tead2 is an endogenous activator of Pax3 in neural crest.