Initially (a), the cells of the ‘pan’ sensory-competent domain express Sox2 as well as Jag1 (strong = dark green or low = light green), which promotes its own expression and adoption of the prosensory fate (and therefore Sox2 expression) by lateral induction. Within the pan-sensory domain, Lmx1a expression is repressed by Notch activity. At its border, a dynamic competition takes place between lateral induction/prosensory specification and the factors promoting Lmx1a expression. (b) The segregation of a prosensory domain could be due to a localized reduction in lateral induction within the pan-sensory domain; this could gradually lead to an upregulation of Lmx1 and a conversion (fate switching) of sensory-competent cells into non-sensory cells at the interface of segregating prosensory patches. (c) As cells commit to their definitive fate, Lmx1 could lead to the formation of the tissue constrictions that separate adjacent sensory organs. The regulatory interactions depicted are likely to involve intermediate factors.