Transcription factors of the TCF family are key mediators of the Wnt/β-catenin pathway. TCF usually activates transcription on cis-regulatory elements containing TCF binding sites when the pathway is active and represses transcription when the pathway is inactive. However, some direct targets display an opposite regulation (activated by TCF in the absence of Wnt), but the mechanism behind this atypical regulation remains poorly characterized. Here, we use the cis-regulatory region of an opposite target gene, ttx-3, to dissect the mechanism of this atypical regulation. Using a combination of genetic, molecular, and biochemical experiments, we establish that, in the absence of Wnt pathway activation, TCF activates ttx-3 expression via a Zic binding site by forming a complex with a Zic transcription factor. This mechanism is later reinforced by specific bHLH factors. This study reveals an atypical mode of action for TCF that may apply to other binary decisions mediated by Wnt signaling.