The patterning of tissues to form subdivisions with distinct and homogeneous regional identity is potentially disrupted by cell intermingling. Transplantation studies suggest that homogeneous segmental identity in the hindbrain is maintained by identity switching of cells that intermingle into another segment. We show that switching occurs during normal development and is mediated by feedback between segment identity and the retinoic acid degrading enzymes, cyp26b1 and cyp26c1. egr2, which specifies the segmental identity of rhombomeres r3 and r5, underlies the lower expression level of cyp26b1 and cyp26c1 in r3 and r5 compared with r2, r4, and r6. Consequently, r3 or r5 cells that intermingle into adjacent segments encounter cells with higher cyp26b1/c1 expression, which we find is required for downregulation of egr2b expression. Furthermore, egr2b expression is regulated in r2, r4, and r6 by non-autonomous mechanisms that depend upon the number of neighbors that express egr2b. These findings reveal that a community regulation of retinoid signaling maintains homogeneous segmental identity.