Extracellular factors such as FGF and EGF control various aspects of morpho
genesis, patterning and cellular proliferation in both invertebrates and ve
rtebrates. In most systems, it is primarily the distribution of these facto
rs that controls the differential behavior of the responding cells, Here we
describe the role of Sprouty in eye development, Sprouty is an extracellul
ar protein that has been shown to antagonize FGF signaling during tracheal
branching in Drosophila, It is a novel type of protein with a highly conser
ved cysteine-rich region. In addition to the embryonic tracheal system, spr
outy is also expressed in other tissues including the developing eye imagin
al disc, embryonic chordotonal organ precursors and the midline glia, In ea
ch of these tissues, EGF receptor signaling is known to participate in the
control of the correct number of neurons or glia. We show that, in all thre
e tissues, the loss of sprouty results in supernumerary neurons or glia, re
spectively. Furthermore, overexpression of sprouty in wing veins and ovaria
n follicle cells, two other tissues where EGF signaling is required for pat
terning, results in phenotypes that resemble the loss-of-function phenotype
s of Egf receptor. These results suggest that Sprouty acts as an antagonist
of EGF as well as FGF signaling pathways. These receptor tyrosine kinase-m
ediated pathways may share not only intracellular signaling components but
also extracellular factors that modulate the strength of the signal.