Antagonism of notch signaling activity by members of a novel protein family encoded by the bearded and enhancer of split gene complexes.

Cell-cell signaling through the Notch receptor is a principal mechanism underlying cell fate specification in a variety of developmental processes in metazoans, such as neurogenesis. In this report we describe our investigation of seven members of a novel gene family in Drosophila with important connections to Notch signaling. These genes all encode small proteins containing predicted basic amphipathic (&agr;)-helical domains in their amino-terminal regions, as described originally for Bearded; accordingly, we refer to them as Bearded family genes. Five members of the Bearded family are located in a newly discovered gene complex, the Bearded Complex; two others reside in the previously identified Enhancer of split Complex. All members of this family contain, in their proximal upstream regions, at least one high-affinity binding site for the Notch-activated transcription factor Suppressor of Hairless, suggesting that all are directly regulated by the Notch pathway. Consistent with this, we show that Bearded family genes are expressed in a variety of territories in imaginal tissue that correspond to sites of active Notch signaling. We demonstrate that overexpression of any family member antagonizes the activity of the Notch pathway in multiple cell fate decisions during adult sensory organ development. These results suggest that Bearded family genes encode a novel class of effectors or modulators of Notch signaling.