The skeletal derivatives of the cranial neural crest (CNC) are patterned through a combination of intrinsic differences between crest cells and extrinsic signals from adjacent tissues, including endoderm and ectoderm. In this chapter, we focus on how CNC cells positionally interpret these cues to generate such highly specialized structures as the jaw and ear ossicles. We highlight recent genetic studies of craniofacial development in zebrafish that have revealed new tissue interactions and show that the process of CNC development is highly conserved across the vertebrates.