Groucho is required for Drosophila neurogenesis, segmentation, and sex determination and interacts directly with hairy-related bHLH proteins.

We have used the interaction trap, a yeast two-hybrid system, to identify proteins interacting with hairy, a basic-helix-loop-helix (bHLH) protein that represses transcription during Drosophila embryonic segmentation. We find that the groucho (gro) protein binds specifically to hairy and also to hairy-related bHLH proteins encoded by deadpan and the Enhancer of split complex. The C-terminal WRPW motif present in all these bHLH proteins is essential for this interaction. We demonstrate that these associations reflect in vivo maternal requirements for gro during neurogenesis, segmentation, and sex determination, three processes regulated by the above bHLH proteins, and we propose that gro is a transcriptional corepressor recruited to specific target promoters by hairy-related bHLH proteins.