The transforming growth factor beta (TGF-beta) family member Decapentaplegic (Dpp) is a key regulator of patterning and growth in Drosophila development. Previous studies have identified a short DNA motif called the silencer element (SE), which recruits a trimeric Smad complex and the repressor Schnurri to downregulate target enhancers upon Dpp signaling. We have now isolated the minimal enhancer of the dad gene and discovered a short motif we termed the activating element (AE). The AE is similar to the SE and recruits the Smad proteins via a conserved mechanism. However, the AE and SE differ at important nucleotide positions. As a consequence, the AE does not recruit Schnurri but rather integrates repressive input by the default repressor Brinker and activating input by the Smad signal transducers Mothers against Dpp (Mad) and Medea via competitive DNA binding. The AE allows the identification of hitherto unknown direct Dpp targets and is functionally conserved in vertebrates.

Epidermal growth factor receptor (EGFR) controls a wide range of developmental events, from body axes specification in insects to cardiac development in humans. During Drosophila oogenesis, a gradient of EGFR activation patterns the follicular epithelium. Multiple transcriptional targets of EGFR in this tissue have been identified, but their regulatory elements are essentially unknown. We report the regulatory elements of broad ( br ) and pipe ( pip ), two important targets of EGFR signaling in Drosophila oogenesis. br is expressed in a complex pattern that prefigures the formation of respiratory eggshell appendages. We found that this pattern is generated by dynamic activities of two regulatory elements, which display different responses to Pointed, Capicua, and Mirror, transcription factors involved in the EGFR-mediated gene expression. One of these elements is active in a pattern similar to pip , a gene repressed by EGFR and essential for establishing the dorsoventral polarity of the embryo. We demonstrate that this similarity of expression depends on a common sequence motif that binds Mirror in vitro and is essential for transcriptional repression in vivo.

Bone Morphogenetic Proteins (BMPs) signal by activating Smad transcription factors to control a number of decisions during animal development. In Drosophila, signaling by the BMP ligand Decapentaplegic (Dpp) involves the activity of brinker (brk) which, in most contexts, is repressed by Dpp. Brk encodes a transcription factor which represses BMP signaling output by antagonizing Smad-dependent target gene activation. Here, we study BMP-dependent gene regulation during Drosophila oogenesis by following the signal transmission from Dpp to its target broad (br), a gene with a crucial function in eggshell patterning. We identify regulatory sequences that account for expression of both brk and br, and connect these to the transcription factors of the pathway. We show that Dpp directly regulates brk transcription through Smad- and Schnurri (Shn)-dependent repression. Brk is epistatic to Dpp in br expression and activates br indirectly, through removal of a repressor, which is yet to be identified. Our work provides first cis-regulatory insights into transcriptional interpretation of BMP signaling in eggshell morphogenesis and defines a transcriptional cascade that connects Dpp to target gene regulation.

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