decapentaplegic and wingless are regulated by eyes absent and eyegone and interact to direct the pattern of retinal differentiation in the eye disc.

Signaling by the secreted hedgehog, decapentaplegic and wingless proteins organizes the pattern of photoreceptor differentiation within the Drosophila eye imaginal disc; hedgehog and decapentaplegic are required for differentiation to initiate at the posterior margin and progress across the disc, while wingless prevents it from initiating at the lateral margins. Our analysis of these interactions has shown that initiation requires both the presence of decapentaplegic and the absence of wingless, which inhibits photoreceptor differentiation downstream of the reception of the decapentaplegic signal. However, wingless is unable to inhibit differentiation driven by activation of the epidermal growth factor receptor pathway. The effect of wingless is subject to regional variations in control, as the anterior margin of the disc is insensitive to wingless inhibition. The eyes absent and eyegone genes encode members of a group of nuclear proteins required to specify the fate of the eye imaginal disc. We show that both eyes absent and eyegone are required for normal activation of decapentaplegic expression at the posterior and lateral margins of the disc, and repression of wingless expression in presumptive retinal tissue. The requirement for eyegone can be alleviated by inhibition of the wingless signaling pathway, suggesting that eyegone promotes eye development primarily by repressing wingless. These results provide a link between the early specification and later differentiation of the eye disc.