During ocular development, periocular neural crest cells (pNC) migrate into the region between the lens and presumptive corneal epithelium to form the corneal endothelium and stromal keratocytes. Although defects in neural crest cell development are associated with ocular dysgenesis, very little is known about the molecular mechanisms involved in this process. This study focuses on the corneal endothelium, a monolayer of specialized cells that are essential for maintaining normal hydration and transparency of the cornea. In avians, corneal endothelial cells are first to be specified from the pNC during their migration into the presumptive corneal region. To investigate the signals required for formation of the corneal endothelium, we utilized orthotopic and heterotopic injections of dissociated quail pNC into chick ocular regions. We find that pNC are multipotent and that the nascent cornea is competent to induce differentiation of ectopically injected pNC into corneal endothelium. Injected pNC downregulate expression of multipotency transcription factors and upregulate genes that are consistent with ontogenesis of the chick corneal endothelium. Importantly, we showed that TGFβ2 is expressed by the nascent lens and the corneal endothelium, and that TGFβ signaling plays a critical role in changing the molecular signature of pNC in vitro. Collectively, our results demonstrate the significance of the ocular environmental cues towards pNC differentiation, and have potential implications for clinical application of stem cells in the anterior segment.