The retinal homeobox (Rx) gene product is essential for eye development. However little is known about its molecular function. It has been demonstrated that Rx binds to photoreceptor conserved element (PCE-1), a highly conserved element found in the promoter region of photoreceptor-specific genes such as rhodopsin and red cone opsin. We verify that Rx is co-expressed with rhodopsin and red cone opsin in maturing photoreceptors and demonstrate that Rx binds to the rhodopsin and red cone opsin promoters in vivo. We also find that Rx can cooperate with the Xenopus analogs of Crx and Nrl, otx5b and XLMaf (respectively), to activate a Xenopus opsin promoter-dependent reporter. Finally, we demonstrate that reduction of Rx expression in tadpoles results in decreases in expression of several PCE-1 containing photoreceptor genes, abnormal photoreceptor morphology, and impaired vision. Our data suggests that Rx, in combination with other transcription factors, is necessary for normal photoreceptor gene expression, maintenance, and function. This establishes a direct role for Rx in regulation of genes expressed in a differentiated cell type.