The mammalian limbic system is sexually dimorphic and underlies sex-specific innate behaviors such as mating, maternal care, and aggression. However, the genetic programs involved in the sexual differentiation of the limbic system are poorly understood. Dmrt transcription factors have emerged as conserved regulators of sex-specific traits across animal kingdom. They have been studied mostly in invertebrates, where they play an important role in nervous system sexual differentiation. In mammals, Dmrt genes have been predominantly studied in the gonads, however, Dmrt5, controls cortex development in humans and mice. In fact, mutations in DMRTA2 (Dmrt5) lead to a recessive human condition characterized by microcephaly and lissencephaly. Surprisingly, there are no studies beyond the cortex nor comparing males and females. In this work we use Dmrt5 null mutant mice, RNAseq and histological techniques to study Dmrt5 function in the developing mammalian nervous system beyond the cortex and comparing males and females. It is plausible that genetic factors involved in brain sexual differentiation, like Dmrt, may represent also etiologic causes for mental disorders, explaining the observed male-female sexual bias. In this study we showed that Dmrt5 is broadly expressed in the mouse nervous system, including the vomeronasal organ, olfactory tubercle, or ventral tegmental area (all key nodes in the control of innate behaviors). Furthermore, we showed that Dmrt5 is necessary for the correct specification of the main olfactory epithelium, the olfactory bulb, and several hypothalamic nuclei. Additionally, we found a novel function for Dmrt5 as a suppressor of sex differences in gene expression in the posterior hypothalamic area and midbrain. In this region, Dmrt5 could be specifying and maintaining a neuronal subpopulation or a group of neurons only in males. Taken together, Dmrt5 comes out as a crucial transcription factor for the accurate differentiation of limbic regions, integrating sex information. By studying the genetic factors involved in sexual differentiation of the nervous system, we might find potential factors to either afford protection or generate vulnerability in one sex versus the other for sex-biased mental disorders.