Organoids can shed light on once hard-to-access patterning and morphogenetic events, guiding our understanding of what happens in the embryo and informing efforts to derive diverse cell types efficiently in the dish. In the mammalian spinal cord, BMP signalling regulates dorsal cell type identity, but recent work with organoids has questioned whether it does so instructively or permissively. Now, Stéphane Nedelec, Vanessa Ribes and colleagues address this question by adapting a 3D embryoid body-based protocol to generate mouse and human spinal organoids with dorsally fated interneuron subtypes. Exposing these organoids to BMP4 leads to a concentric spatial arrangement of cell types resembling that of the developing spinal cord, with dorsal cells found more peripherally. This pattern is established via a gradient of SMAD activation, which itself is biased by the spontaneous formation of an external epithelium in the developing organoids. In both species, modulating BMP4 concentration, duration of exposure or the time of exposure determines the type of dorsal cells generated, but the competence time windows to respond to BMPs are extended in humans. Overall, this work supports an instructive role of BMPs in generating patterns of cell types in the dorsal spinal cord, with time-dependent changes in progenitor competence controlling cell type diversification.