The transcription factors GATA3 and Pax2 are expressed throughout development of the mouse inner ear. We have used antibodies to study their temporal and spatial expression patterns from embryonic days E8–E16.5. The two factors show reciprocal relationships in the regional patterning of the early otocyst and cellular patterning within the sensory epithelia. GATA3 is expressed in the whole otic placode at E8. In the otocyst at E9.5–10.5, the distribution is lateral and complementary to the medial expression pattern of Pax2. Only Pax2 is expressed in the endolymphatic duct, but both factors are expressed in the cochlea. At E11.5–13.5, GATA3 is expressed strongly in the cochlea, but in the dorsal, vestibular region it is downregulated. In all sensory epithelia, downregulation coincides with sensory innervation. Pax2 is expressed in all sensory and some nonsensory epithelia, but within sensory epithelia at E16.5 it is restricted to hair cells. GATA3 is expressed throughout key periods of cell proliferation, fate determination, and differentiation and is not specifically associated with any of these processes. Expression persists most strongly in the main components of the developing auditory system. These include the auditory sensory epithelium, the afferent and efferent nerves, and the mesenchymal and ectodermal cells in regions that form key parts of the middle and outer ear. GATA3 is thus expressed in functionally distinct groups of cells that integrate to form a complete sensory system. The results suggest that both factors may be involved in tissue compartmentalisation, morphogenesis, and cell signalling. J. Comp. Neurol. 442:378–391, 2002. © 2002 Wiley-Liss, Inc.