Increasing evidence indicates that development of embryonic central nervous system precursors is tightly regulated by extrinsic cues located in the local environment. Here, we asked whether neurotrophin-mediated signaling through Trk tyrosine kinase receptors is important for embryonic cortical precursor cell development. These studies demonstrate that inhibition of TrkB (Ntrk2) and/or TrkC (Ntrk3) signaling using dominant-negative Trk receptors, or genetic knockdown of TrkB using shRNA, caused a decrease in embryonic precursor cell proliferation both in culture and in vivo. Inhibition of TrkB/C also caused a delay in the generation of neurons, but not astrocytes, and ultimately perturbed the postnatal localization of cortical neurons in vivo. Conversely, overexpression of BDNF in cortical precursors in vivo promoted proliferation and enhanced neurogenesis. Together, these results indicate that neurotrophin-mediated Trk signaling plays an essential, cell-autonomous role in regulating the proliferation and differentiation of embryonic cortical precursors and thus controls cortical development at earlier stages than previously thought.