The Caenorhabditis elegans AWA, AWB, and AWC olfactory neurons are each required for the recognition of a specific subset of volatile odorants. lim-4 mutants express an AWC reporter gene inappropriately in the AWB olfactory neurons and fail to express an AWB reporter gene. The AWB cells are morphologically transformed toward an AWC fate in lim-4 mutants, adopting cilia and axon morphologies characteristic of AWC. AWB function is also transformed in these mutants: Rather than mediating the repulsive behavioral responses appropriate for AWB, the AWB neurons mediate attractive responses, like AWC. LIM-4 is a predicted LIM homeobox gene that is expressed in AWB and a few other head neurons. Ectopic expression of LIM-4 in the AWC neuron pair is sufficient to force those cells to adopt an AWB fate. The AWA nuclear hormone receptor ODR-7 described previously also represses AWC genes, as well as inducing AWA genes. We propose that the LIM-4 and ODR-7 transcription factors function to diversify C. elegans olfactory neuron identities, driving them from an AWC-like state into alternative fates.