Holoprosencephaly (HPE), characterized by incomplete separation of forebrain and facial components into left and right sides, is a common developmental defect in humans. It is caused by both genetic and environmental factors and its severity covers a wide spectrum of phenotypes. The genetic interactions underlying inherited forms of HPE are complex and poorly understood. Animal models, in particular mouse mutants, are providing a growing understanding of how the forebrain develops and how the cerebral hemispheres become split into left and right sides. These insights, along with the characterization to date of some of the genes involved in human HPE, suggest that two distinct mechanisms underlie the major classes of HPE, 'classic' and midline interhemispheric (MIH). Disruption either directly or indirectly of the ventralizing effect of sonic hedgehog signaling appears central to all or most forms of classic HPE, while disruption of the dorsalizing effect of bone morphogenetic protein signaling may be key to cases of MIH HPE.