Notch signaling plays a well-described role in regulating the formation of neurons from proliferative neural precursors in vertebrates but whether, as in flies, it also specifies sibling cells for different neuronal fates is not known. Ventral spinal cord precursors called pMN cells produce mostly motoneurons and oligodendrocytes, but recent lineage-marking experiments reveal that they also make astrocytes, ependymal cells and interneurons. Our own clonal analysis of pMN cells in zebrafish showed that some produce a primary motoneuron and KA' interneuron at their final division. We investigated the possibility that Notch signaling regulates a motoneuron-interneuron fate decision using a combination of mutant, transgenic and pharmacological manipulations of Notch activity. We show that continuous absence of Notch activity produces excess primary motoneurons and a deficit of KA' interneurons, whereas transient inactivation preceding neurogenesis results in an excess of both cell types. By contrast, activation of Notch signaling at the neural plate stage produces excess KA' interneurons and a deficit of primary motoneurons. Furthermore, individual pMN cells produce similar kinds of neurons at their final division in mib mutant embryos, which lack Notch signaling. These data provide evidence that, among some postmitotic daughters of pMN cells, Notch promotes KA' interneuron identity and inhibits primary motoneuron fate, raising the possibility that Notch signaling diversifies vertebrate neuron type by mediating similar binary fate decisions.