The mammalian olfactory epithelium is composed of neurons and supporting cells organized into distinct zones that enable parallel processing of innate and experience-dependent odor information. Despite its well-defined architecture, the mechanisms that regulate progenitor cell potential in a zone-specific manner remain poorly understood. Here, we identify a role for the transcription factor Foxg1 in defining ventrolateral (V) zonal identity by sustaining neurogenic progenitor cell potential. Using inducible Foxg1 knockout mice combined with lineage tracing, we demonstrate that loss of Foxg1 selectively reduces the V-zone size without affecting the dorsomedial (D) zone. Clonal lineage analysis further revealed that olfactory epithelium progenitors normally give rise to either olfactory sensory neurons or sustentacular cells. Among these, Foxg1-expressing progenitors predominantly contribute to neurogenic lineages, whereas Foxg1 deletion promotes differentiation into sustentacular cells. Together, these findings uncover a cell-autonomous role of Foxg1 in maintaining neurogenic progenitor potential within the V-zone, offering new insight into spatially restricted transcriptional programs that coordinate epithelial growth and neurogenesis to shape experience-dependent sensory circuits.