ABSTRACT Neural precursor cells in Drosophila arise from the ectoderm in the embryo and from imaginal disc epithelia in the larva. In both cases, this process requires daugh - terless and the proneural genes achaete, scute and lethal-of-scute of the achaete-scute complex. These genes encode basic helix-loop-helix proteins, which are nuclear transcription factors, as does the asense gene of the achaete-scute complex. Our studies suggest that asense is a neural precursor gene, rather than a proneural gene. Unlike the proneural achaete-scute gene products, the asense RNA and protein are found in the neural precursor during its formation, but not in the proneural cluster of cells that gives rise to the neural precursor cell. Also, asense expression persists longer during neural precursor development than the proneural gene products; it is still expressed after the first division of the neural precursor. Moreover, asense is likely to be down-stream of the proneural genes, because (1) asense expression is affected in proneural and neurogenic mutant backgrounds, (2) ectopic expression of asense protein with an intact DNA-binding domain bypasses the requirement for achaete and scute in the formation of imaginal sense organs. We further note that asense ectopic expression is capable of initiating the sense organ fate in cells that do not normally require the action of asense. Our studies therefore serve as a cautionary note for the inference of normal gene function based on the gain-of-function phenotype after ectopic expression.