Background: Among the Lophotrochozoa, cephalopods possess the highest degree of central nervous system (CNS) centralization and complexity. Although the anatomy of the developing cephalopod CNS has been investigated, the developmental mechanisms underlying brain development and evolution are unknown. POU genes encode key transcription factors controlling nervous system development in a range of bilaterian species, including lophotrochozoans. In this study, we investigate the expression of POU genes during early development of the pygmy squid Idiosepius notoides and make comparisons with other bilaterians to reveal whether these genes have conserved or divergent roles during CNS development in this species. Results: POU2, POU3, POU4 and POU6 orthologs were identified in transcriptomes derived from developmental stages and adult brain tissue of I. notoides. All four POU gene orthologs are expressed in different spatiotemporal combinations in the early embryo. Ino-POU2 is expressed in the gills and the palliovisceral, pedal, and optic ganglia of stage 19 to 20 embryos, whereas the cerebral and palliovisceral ganglia express Ino-POU3. Ino-POU4 is expressed in the optic and palliovisceral ganglia and the arms/intrabrachial ganglia of stage 19 to 20 individuals. Ino-POU6 is expressed in the palliovisceral ganglia during early development. In stage 25 embryos expression domains include the intrabrachial ganglia (Ino-POU3) and the pedal ganglia (Ino-POU6). All four POU genes are strongly expressed in large areas of the brain of stage 24 to 26 individuals. Expression could not be detected in late prehatching embryos (approximately stage 27 to 30). Conclusions: The expression of four POU genes in unique spatiotemporal combinations during early neurogenesis and sensory organ development of I. notoides suggests that they fulfill distinct tasks during early brain development. Comparisons with other bilaterian species reveal that POU gene expression is associated with anteriormost neural structures, even between animals for which these structures are unlikely to be homologous. Within lophotrochozoans, POU3 and POU4 are the only two genes that have been comparatively investigated. Their expression patterns are broadly similar, indicating that the increased complexity of the cephalopod brain is likely due to other unknown factors.