Colonial ascidians offer opportunities to investigate how developmental events are integrated to generate the animal form, since they can develop similar individuals (oozooids from eggs, blastozooids from pluripotent somatic cells) through very different reproductive processes, i.e. embryogenesis and blastogenesis. Moreover, thanks to their key phylogenetic position, they can help in the understanding of the molecular mechanisms of morphogenesis and their evolution in chordates. We review organogenesis of the ascidian neural complex comparing embryos and buds in terms of topology, developmental mechanisms and terminology. We propose a new interpretation of bud territories, and reconsider nervous system development based on recent results suggesting that ascidians have vertebrate placodal and neural-crest-like cells. Comparing embryonic and blastogenic development in Botryllus schlosseri, we propose that the bud has territories with a placodal potentiality, suggesting that chordate ancestors possessed neurogenic placodes, and that the genetic pathways regulating neurogenic placode formation were co-opted for new developmental processes, such as blastogenesis. BioEssays 28: 902–912, 2006. © 2006 Wiley periodicals, Inc.