The transcription factor Sox10 is required for proper development of various neural crest-derived cell types. Several lineages including melanocytes, autonomic and enteric neurons, and all subtypes of peripheral glia are missing in mice homozygous for Sox10 mutations. Moreover, haploinsufficiency of Sox10 results in neural crest defects that cause Waardenburg/Hirschsprung disease in humans. We provide evidence that the cellular basis to these phenotypes is likely to be a requirement for Sox10 by neural crest stem cells before lineage segregation. Cell death is increased in undifferentiated, postmigratory neural crest cells that lack Sox10, suggesting a role of Sox10 in the survival of neural crest cells. This function is mediated by neuregulin, which acts as a survival signal for postmigratory neural crest cells in a Sox10-dependent manner. Furthermore, Sox10 is required for glial fate acquisition, as the surviving mutant neural crest cells are unable to adopt a glial fate when challenged with different gliogenic conditions. In Sox10 heterozygous mutant neural crest cells, survival appears to be normal, while fate specifications are drastically affected. Thereby, the fate chosen by a mutant neural crest cell is context dependent. Our data indicate that combinatorial signaling by Sox10, extracellular factors such as neuregulin 1, and local cell-cell interactions is involved in fine-tuning lineage decisions by neural crest stem cells. Failures in fate decision processes might thus contribute to the etiology of Waardenburg/Hirschsprung disease.