Integrity and preservation of a transparent cornea are essential for good vision. The corneal epithelium is stratified and nonkeratinized and is maintained and repaired by corneal stem cells. Here we demonstrate that Notch1 signaling is essential for cell fate maintenance of corneal epithelium during repair. Inducible ablation of Notch1 in the cornea combined with mechanical wounding show that Notch1-deficient corneal progenitor cells differentiate into a hyperplastic, keratinized, skin-like epithelium. This cell fate switch leads to corneal blindness and involves cell nonautonomous processes, characterized by secretion of fibroblast growth factor-2 (FGF-2) through Notch1^−/− epithelium followed by vascularization and remodeling of the underlying stroma. Vitamin A deficiency is known to induce a similar corneal defect in humans (severe xerophthalmia). Accordingly, we found that Notch1 signaling is linked to vitamin A metabolism by regulating the expression of cellular retinol binding protein 1 (CRBP1), required to generate a pool of intracellular retinol.