Germline cells segregate from the soma to maintain their totipotency, but the cellular mechanisms of this segregation are unclear. The Drosophila melanogaster embryo forms a posterior group of primordial germline cells (PGCs) by their division from the syncytial soma. Extended plasma membrane furrows enclose the PGCs in response to the germ plasm protein Germ cell-less (Gcl) and Rho1-actomyosin activity. Recently, we found that loss of the Arf-GEF Steppke (Step) leads to similar Rho1-dependent plasma membrane extensions but from pseudocleavage furrows of the soma. Here, we report that the loss of step also leads to premature formation of a large cell group at the anterior pole of the embryo . These anterior cells lacked germ plasm, but budded and formed at the same time as posterior PGCs, and then divided asynchronously as PGCs also do. With genetic analyses we found that Step normally activates Arf small G proteins and antagonizes Rho1-actomyosin pathways to inhibit anterior cell formation. A uniform distribution of step mRNA around the one-cell embryo cortex suggested that Step restricts cell formation through a global control mechanism. Thus, we examined the effect of Step on PGC formation at the posterior pole. Reducing Gcl or Rho1 levels decreased PGC numbers, but additional step RNAi restored their numbers. Reciprocally, GFP-Step overexpression induced dosage-and Arf-GEF-dependent loss of PGCs, an effect worsened by reducing Gcl or actomyosin pathway activity. We propose that a global distribution of Step normally sets an inhibitory threshold for Rho1 activity to restrict early cell formation to the posterior.