Differentiation of hematopoietic progenitors into the B‐lymphocyte lineage requires co‐ordination of a complex network of transcriptional regulators. Lineage specificity is likely to result from combinatorial mechanisms of gene regulation. Four general functions are mediated by transcription factors in the differentiating pro‐B cell. First, a cascade of B‐cell‐restricted transcription factors is upregulated. Second, genes involved in the specification of other cell fates are repressed. Both activation and repression require the participation of different classes of transcriptional regulators, including proteins of the Ikaros family that can recruit chromatin‐modifying complexes. Third, the expression of genes that facilitate B‐cell proliferation and differentiation are activated. Lastly, genes required for recombination are expressed and targeted to the immunoglobulin loci, thus initiating the characteristic rearrangement of the immunoglobulin genes. The interactions and functions of transcription factors in pro‐B‐cell differentiation are discussed.