During early development, the hindbrain is sub-divided into rhombomeres that underlie the organisation of neurons and adjacent craniofacial tissues. A gene regulatory network of signals and transcription factors establish and pattern segments with a distinct anteroposterior identity. Initially, the borders of segmental gene expression are imprecise, but then become sharply defined, and specialised boundary cells form. In this Review, we summarise key aspects of the conserved regulatory cascade that underlies the formation of hindbrain segments. We describe how the pattern is sharpened and stabilised through the dynamic regulation of cell identity, acting in parallel with cell segregation. Finally, we discuss evidence that boundary cells have roles in local patterning, and act as a site of neurogenesis within the hindbrain.