During brain development, neurogenesis, migration, and differentiation of neural progenitor cells are regulated by an interplay between intrinsic genetic programs and extrinsic cues. The Dlx homeogene transcription factors have been proposed to directly control the genesis and maturation of GABAergic interneurons of the olfactory bulb (OB), subpallium, and cortex. Here we provide evidence that Dlx genes promote differentiation of olfactory interneurons via the signaling molecule Wnt5a. Dlx2 and Dlx5 interact with homeodomain binding sequences within the Wnt5a locus and activate its transcription. Exogenously provided Wnt5a promotes GABAergic differentiation in dissociated OB neurons and in organ-type brain cultures. Finally, we show that the Dlx-mutant environment is unfavorable for GABA differentiation, in vivo and in vitro. We conclude that Dlx genes favor interneuron differentiation also in a non-cell-autonomous fashion, via expression of Wnt5a.