The mammalian telencephalon contains distinct GABAergic projection neuron and interneuron types, originating in the germinal zone of the embryonic basal ganglia. How genetic information in the germinal zone determines cell types is unclear. Here we use a combination of in vivo CRISPR perturbation, lineage tracing and ChIP-sequencing analyses and show that the transcription factor MEIS2 favors the development of projection neurons by binding enhancer regions in projection-neuron-specific genes during mouse embryonic development. MEIS2 requires the presence of the homeodomain transcription factor DLX5 to direct its functional activity toward the appropriate binding sites. In interneuron precursors, the transcription factor LHX6 represses the MEIS2-DLX5-dependent activation of projection-neuron-specific enhancers. Mutations of Meis2 result in decreased activation of regulatory enhancers, affecting GABAergic differentiation. We propose a differential binding model where the binding of transcription factors at cis-regulatory elements determines differential gene expression programs regulating cell fate specification in the mouse ganglionic eminence.