Hi Sfdcfox,

I tried that, but the issue was when I am trying to remove the required mark using hte formulae, it still remaining there and showing the validation you "must enter". Please find the mark up below

<apex:page standardController="Opportunity" extensions="PopupTest" id="pgDisp" sidebar="false" showheader="false"> 
<apex:form id="frmDisp">  
  <apex:actionFunction name="refreshPicklists" reRender="Prblty,DispCat,Prfmc,pbsDsp"/>
  <apex:pageMessages></apex:pageMessages>
      <apex:pageBlock id="pbDisp">
          <apex:actionFunction name="PSRen" action="{!PrmSubRsn}" reRender="PSRsnPnl,pbsiDisp2" />
          <apex:actionStatus id="loading" onstart="loading(true)" onstop="loading(false)" />
          
         <apex:outputPanel id="PSRsnPnl"> 
         <apex:pageBlockSection columns="1" id="pbsStgnm">
             <apex:inputField value="{!Opportunity.stageName}" required="true" onchange="refreshDisp();"/>
             <apex:inputField value="{!Opportunity.Probability}" required="true" id="prblty"/>
         </apex:pageBlockSection>
         <apex:pageBlockSection columns="1" id="pbsDsp" rendered="{!(Opportunity.stagename = 'Closed Won' || Opportunity.stagename = 'Closed Lost' || Opportunity.stagename = 'Cancelled') }">    
             
             <apex:inputField value="{!Opportunity.Disposition_Reason__c}" required="{!(Opportunity.stagename = 'Closed Won' || Opportunity.stagename = 'Closed Lost' || Opportunity.stagename = 'Cancelled') }"  id="DispCat"/>
             
         
          
       
             <apex:inputField value="{!Opportunity.Performance__c}" required="{!(Opportunity.Disposition_Reason__c = 'Best Value' || Opportunity.Disposition_Reason__c = 'Not Best Value')}" id="Prfmc"/>
             
         </apex:pageBlockSection>       
         <div id="contentLoading" style="display:none;">
                    <div style="text-align: center; border:none,padding:15px,backgroundColor:#000,-webkit-border-radius: 10px,-moz-border-radius:10px,opacity: .5,color:#fff">
                       <FONT FACE="Helvetica,Verdana,Arial" SIZE="3" COLOR="#000066"><B>Please wait...</B></FONT>
                    </div>
                </div>   
         <apex:pageBlockSection id="pbsDisp" columns="1">
             
              <apex:pageblockSectionItem id="pbsiDisp">
                  <apex:outputLabel value="Primary Reason"></apex:outputLabel>
                  <apex:actionRegion >
                    
                        <apex:selectList value="{!selectedPRsn}" onchange="getSubReason();" onblur="getSubReason();" onfocus="showDetail(this, 'Primary');" id="selPicklistPRsn"  size="1" >
                           <apex:selectOptions value="{!PRsn}"/>
                        </apex:selectList>
                       <div id="Primary_description" style="display:none;">
                                    <apex:outputText value="{!PrmdescriptionString}" escape="false" />
                                </div>  
                  </apex:actionRegion>
                                    
                   
                                               
              </apex:pageblockSectionItem>
              <apex:pageblockSectionItem id="pbsiDisp2">
                  <apex:outputLabel value="Primary Sub Reason"></apex:outputLabel>
                  <apex:actionRegion > 
                                      
                        <apex:selectList value="{!selectedPSRsn}" onchange="hideDetail();" onblur="hideDetail();" onfocus="showDetail(this, 'Sub');" id="selPicklistPSRsn"  size="1" disabled="{!selectedPRsn = ''}">
                           <apex:selectOptions value="{!PSRValues}"/>
                        </apex:selectList>    
                          <div id="Sub_description" style="display:none;">
                                    <apex:outputText value="{!PrmSbdescriptionString}" escape="false" />
                                </div>             
                  </apex:actionRegion>                                                                                                      
              </apex:pageblockSectionItem>
             
            </apex:pageBlockSection>
          </apex:outputPanel>       
          <apex:pageBlockButtons location="bottom" id="pgblkBtn">              
              <apex:commandButton value="Save" action="{!Save}" oncomplete="javascript&colon;window.close();"/>
              <apex:commandButton value="Cancel" id="bckBtn" onclick="javascript&colon;window.close();" immediate="false"/>
          </apex:pageBlockButtons>
           
                               
                            
          <apex:outputText value="{!Opportunity.stagename}" rendered="false"/>
          <apex:outputText value="{!Opportunity.RecordType.Name}" rendered="false"/>
          <apex:outputText value="{!Opportunity.Primary_Reason__c}" rendered="false"/>
          <apex:outputText value="{!Opportunity.Primary_Sub_Reason__c}" rendered="false"/>
      </apex:pageBlock>
  </apex:form>
  <script>
      function showDetail(el, id) {
            //var Prm = document.getElementById("pgDisp:frmDisp:pbDisp:pbsDisp:pbsiDisp:selPicklistPRsn");
            var td = jQuery(el).parent().parent();
            var tr = td.parent();
            var riskFactorCell = td.prev();
            var CategoryCell = riskFactorCell.prev();
            var popupWidth = riskFactorCell.width() + CategoryCell.width();           
            var riskFactorOffset = riskFactorCell.offset();
            var eleOffset = CategoryCell.offset();
            var description = jQuery("#"+id+"_description").html();                       
            jQuery("#deviationInner").html(description);
            jQuery("#deviationDescription").css('width', 250);
            jQuery("#deviationDescription").css('position', 'absolute');
            jQuery("#deviationDescription").css('right', 25);
            jQuery("#deviationDescription").css('top', 50);
            var tableHeight = jQuery("#pbsDisp").height();
            jQuery("#deviationDescription").fadeIn();
        }
        
        
       
        function hideDetail() {
            jQuery("#deviationDescription").hide();
            document.getElementById("pgDisp:frmDisp:pbDisp:pgblkBtn:bckBtn").focus();
        }
        
        function getSubReason()
        {
            hideDetail();
            PSRen();
        }
        
        function loading(val) {
           if (val) {
              document.getElementById('contentLoading').style.display = 'block';
             
            }
            else {
              document.getElementById('contentLoading').style.display = 'none';
              
            }
       }
       
       function refreshDisp()
       {
           
           refreshPicklists();
       }
      
  </script>

 THe custom picklists functionality is working fine, all i wanted is to mimic the standard dependancy functionality between stage, probability, Disposition Info. Can you please suggest any work around in this regard.

Thanks

--yvk