The retinal determination gene Dachshund restricts cell proliferation by limiting the activity of the Homothorax-Yorkie complex.

The Drosophila transcriptional co-activator protein Yorkie and its vertebrate orthologs YAP and TAZ are potent oncogenes, whose activity is normally kept in check by the upstream Hippo kinase module. Upon its translocation into the nucleus, Yorkie forms complexes with several tissue-specific DNA-binding partners, which help to define the tissue-specific target genes of Yorkie. In the progenitor cells of the eye imaginal disc, the DNA-binding transcription factor Homothorax is required for Yorkie-promoted proliferation and survival through regulation of the bantam microRNA (miRNA). The transit from proliferating progenitors to cell cycle quiescent precursors is associated with the progressive loss of Homothorax and gain of Dachshund, a nuclear protein related to the Sno/Ski family of co-repressors. We have identified Dachshund as an inhibitor of Homothorax-Yorkie-mediated cell proliferation. Loss of dachshund induces Yorkie-dependent tissue overgrowth. Conversely, overexpressing dachshund inhibits tissue growth, prevents Yorkie or Homothorax-mediated cell proliferation of disc epithelia and restricts the transcriptional activity of the Yorkie-Homothorax complex on the bantam enhancer in Drosophila cells. In addition, Dachshund collaborates with the Decapentaplegic receptor Thickveins to repress Homothorax and Cyclin B expression in quiescent precursors. The antagonistic roles of Homothorax and Dachshund in Yorkie activity, together with their mutual repression, ensure that progenitor and precursor cells are under distinct proliferation regimes. Based on the crucial role of the human dachshund homolog DACH1 in tumorigenesis, our work suggests that DACH1 might prevent cellular transformation by limiting the oncogenic activity of YAP and/or TAZ.