Dorsal-ventral patterning of the mammalian telencephalon is fundamental to the formation of distinct functional regions including the neocortex and ganglionic eminence. While Bone morphogenetic protein (BMP), Wnt, and Sonic hedgehog (Shh) signaling are known to determine regional identity along the dorsoventral axis, how the region-specific expression of these morphogens is established remains unclear. Here we show that the Polycomb group (PcG) protein Ring1 contributes to the ventralization of the mouse telencephalon. Deletion of Ring1b or both Ring1a and Ring1b in neuroepithelial cells induces ectopic expression of dorsal genes, including those for BMP and Wnt ligands, as well as attenuated expression of the gene for Shh, a key morphogen for ventralization, in the ventral telencephalon. We observe PcG protein-mediated trimethylation of histone 3 at lysine-27 and binding of Ring1B at BMP and Wnt ligand genes specifically in the ventral region. Furthermore, forced activation of BMP or Wnt signaling represses Shh expression. Our results thus indicate that PcG proteins suppress BMP and Wnt signaling in a region-specific manner and thereby allow proper Shh expression and development of the ventral telencephalon.