The cichlid fishes comprise the largest extant vertebrate family and are the quintessential example of rapid “explosive” adaptive radiations and phenotypic diversification. Despite low genetic divergence, East African cichlids harbour a spectacular intra- and interspecific morphological diversity. Akin to other vertebrates, a considerable proportion of hyper-diverse cichlid traits, such as craniofacial morphologies and pigmentation patterns, originates from a common embryonic migratory progenitor cell population, the neural crest (NC). Although the genetic and developmental basis of these phenotypes has been investigated, understanding of how and when, specifically how early, in ontogeny species-specific differences emerge, remains limited. In this PhD thesis, I present a multispecies comparative analysis of the developmental basis of NC-derived phenotypic diversity in Lake Malawi cichlids, focusing on the variation in development of the embryo, NC, and its derivatives. First, I demonstrate fundamental differences in multiple aspects of cichlid embryogenesis, including variation in morphology and timing, duration, and rate of developmental events (heterochrony) concomitant with NC development. Interspecific differences were also identified at the onset of overt formation of craniofacial skeleton and body pigmentation, irrespective of the developmental heterochronies. Second, I characterise the developmental and cellular basis of divergent pigmentation patterns among cichlids, including in the underexplored context of sexual dimorphism in this NC-derived trait. Among the abundant differences between species in many aspects of body colouration, I show that, in contrast to zebrafish, divergent cellular mechanisms underlie formation of analogous phenotypes among closely related cichlids. These results provide a novel perspective on the developmental basis and evolution of vertebrate pigmentation beyond traditional model systems. Finally, I examine the temporal and spatial variation in NC genetic and developmental programme in two divergent cichlids. In addition to spatial-temporal differences in migratory pathways of the NC cells, I identified novel NC subpopulations based on the differential expression of canonical marker of migratory NC sox10 and its duplicate sox10-like. The variation in the spatial distribution of these NC subpopulations implicates neo- and subfunctionalisation as well as partial redundancy between sox10 duplicates, one of which has been lost in the well-studied zebrafish lineage, and thus entirely unexplored role in NC and teleost evolution. The results I present in this thesis offer an integrated perspective on the complex genetic and developmental basis of cichlid morphological variation, spanning from the fundamental processes of embryogenesis to development of the NC and its derivatives. In particular, my work provides compelling evidence of the unprecedented variability in the NC developmental programme between closely related species and therefore contributes to our understanding of the role of this remarkable cell population in evolution of vertebrate morphological diversity.