Cerebral cortical functions are conducted by two general classes of neurons: glutamatergic projection neurons and GABAergic interneurons. Distinct interneuron subtypes serve distinct roles in modulating cortical activity and can be differentially affected in cortical diseases, but little is known about the mechanisms for generating their diversity. Recent evidence suggests that many cortical interneurons originate within the subcortical telencephalon and then migrate tangentially into the overlying cortex. To test the hypothesis that distinct interneuron subtypes are derived from distinct telencephalic subdivisions, we have used an in vitro assay to assess the developmental potential of subregions of the telencephalic proliferative zone (PZ) to give rise to neurochemically defined interneuron subgroups. PZ cells from GFP+ donor mouse embryos were transplanted onto neonatal cortical feeder cells and assessed for their ability to generate specific interneuron subtypes. Our results suggest that the parvalbumin- and the somatostatin-expressing interneuron subgroups originate primarily within the medial ganglionic eminence (MGE) of the subcortical telencephalon, whereas the calretinin-expressing interneurons appear to derive mainly from the caudal ganglionic eminence (CGE). These results are supported by findings from primary cultures of cortex from Nkx2.1 mutants, in which normal MGE fails to form but in which the CGE is less affected. In these cultures, parvalbumin- and somatostatin-expressing cells are absent, although calretinin-expressing interneurons are present. Interestingly, calretinin-expressing bipolar interneurons were nearly absent from cortical cultures of Dlx1/2 mutants. By establishing spatial differences in the origins of interneuron subtypes, these studies lay the groundwork for elucidating the molecular bases for their distinct differentiation pathways.