The cerebellum provides an excellent system for understanding how afferent and target neurons coordinate sequential intercellular signals and cell-autonomous genetic programs in development. Mutations in the orphan nuclear receptor RORalpha block Purkinje cell differentiation with a secondary loss of afferent granule cells. We show that early transcriptional targets of RORalpha include both mitogenic signals for afferent progenitors and signal transduction genes required to process their subsequent synaptic input. RORalpha acts through recruitment of gene-specific sets of transcriptional cofactors, including beta-catenin, p300, and Tip60, but appears independent of CBP. One target promoter is Sonic hedgehog, and recombinant Sonic hedgehog restores granule precursor proliferation in RORalpha-deficient cerebellum. Our results suggest a link between RORalpha and beta-catenin pathways, confirm that a nuclear receptor employs distinct coactivator complexes at different target genes, and provide a logic for early RORalpha expression in coordinating expression of genes required for reciprocal signals in cerebellar development.