The Pax-6 genes of vertebrates and invertebrates encode transcription factors with both a paired domain and a homeodomain. They are expressed in the developing eye and in the central nervous system. Loss-of-function mutations in mammals and in flies result in a reduction or absence of eyes and targeted expression of the Drosophila and the mouse Pax-6 genes induces ectopic eye structures in Drosophila. These findings lead to the proposal that the morphogenesis of the different types of eyes is controlled by a Pax-6-dependent genetic pathway and that the various eye types are of monophyletic origin. We have isolated a Pax-6 homologous gene from the ascidian Phallusia mammillata, because ascidians occupy an important position in early chordate evolution, Furthermore, the Phallusia larva has a simple photosensitive ocellus. Phallusia Pax-6 shares extensive sequence identity and conserved genomic organization with the known Pax-6 genes of vertebrates and invertebrates. Expression of Phallusia Pax-6 is first detected at late gastrula stages in distinct regions of the developing neural plate. At the tailbud stage, it is expressed in the spinal cord and the brain vesicle, where the sensory organs (ocellus and otolith) form, suggesting an important function in their development, Ectopic expression of the ascidian Pax-6 gene in Drosophila leads to the induction of supernumerary eyes indicating a highly conserved gene regulatory function for Pax-6 genes.