Astrocyte specification during development is influenced by both intrinsic and extrinsic factors, but the precise contribution of each remains poorly understood. Here we show that mouse septal astrocytes derived from Nkx2.1- and Zic4-expressing progenitor zones are primarily allocated into the medial septal and lateral septal nuclei, respectively. Astrocytes in these areas exhibit distinctive molecular and morphological features. Using single-nucleus RNA sequencing, we traced the developmental trajectories of cells in the septum and found that neurons and astrocytes undergo region-specific and developmental-stage-specific local cell-cell interactions. Expression of the morphogens sonic hedgehog and fibroblast growth factors by medial septal and lateral septal neurons, respectively, promote the specification of astrocytes in each region. Finally, heterotopic cell transplantation studies showed that septal astrocyte specification depends on the local microenvironment, regardless of developmental origin. Our data highlight the importance of the local environment in determining astrocyte functional specialization.