Background The availability of specific markers expressed in different regions of the developing nervous system provides a useful tool for the study of mouse mutants. One such marker, the transcription factor Pax2, is expressed at the midbrain-hindbrain boundary and in the cerebellum, spinal cord, retina, optic stalk, and optic chiasm. We recently described a group of diencephalic cells that express Pax2 as early as embryonic day (E) 10.5, and become part of the eminentia thalami by E11.5. The discovery of this previously undescribed cell population prompted us to examine Pax2 protein expression in the developing mouse forebrain in more detail. Results We determined the expression pattern of Pax2 in the forebrain of wild type mouse embryos between E10.5 and postnatal day (P) 15. Pax2 expression was detected in the septum of the basal forebrain, hypothalamus, eminentia thalami and in the subfornical organ. To evaluate Pax2 as a marker for septal cells, we examined Pax2 expression in Pax6Sey/Sey mutants, which have an enlarged septum. We found that Pax2 clearly marks a population of septal cells equivalent to that seen in wild types, indicating its utility as a marker of septal identity. These cells did not express the GABAergic marker calbindin nor the cholinergic marker choline acetyltransferase and were not detectable after P15. Conclusion Pax2 is expressed in populations of cells within the developing septum, hypothalamus, and eminentia thalami. It seems especially useful as a marker of the telencephalic septum, because of its early, strong and characteristic expression in this structure. Further, its expression is maintained in the enlarged septum of Pax6Sey/Sey mutants.