During central nervous system development the timing of progenitor differentiation must be precisely controlled to generate the proper number and complement of neuronal cell types. Proneural basic helix-loop-helix (bHLH) transcription factors play a central role in regulating neurogenesis, and thus the timing of their expression must be regulated to ensure that they act at the appropriate developmental time. In the developing retina, the expression of the bHLH factor Ath5 is controlled by multiple signals in early retinal progenitors, although less is known about how these signals are coordinated to ensure correct spatial and temporal pattern of gene expression. Here we identify a key distal Xath5 enhancer and show that this enhancer regulates the early phase of Xath5 expression, while the proximal enhancer we previously identified acts later. The distal enhancer responds to Pax6, a key patterning factor in the optic vesicle, while FGF signaling regulates Xath5 expression through sequences outside of this region. In addition, we have identified an inhibitory element adjacent to the conserved distal enhancer region that is required to prevent premature initiation of expression in the retina. This temporal regulation of Xath5 gene expression is comparable to proneural gene regulation in Drosophila, whereby separate enhancers regulate different temporal phases of expression.