During development, regulation of gene expression is key to cellular homeostasis. Gene expression regulation by non-coding RNAs involves the prevention of mRNA accumulation or the inhibition of translation of their target gene. In a forward-genetic screen to identify the microRNA involved in the growth and patterning of the Drosophila eye, we identified the highly conserved miR-137. Gain of function of miR-137 results in a reduced-eye phenotype by downregulating retinal determination and differentiation markers, and by upregulating negative regulators of eye development, such as Wingless (Wg) and Homothorax (Hth). Loss of function of miR-137 results in an enlarged-eye phenotype. Using bioinformatics and genetic approaches, we identified the oncogene Myc as the target of miR-137. Gain of function of Myc can rescue the reduced-eye phenotype of miR-137 gain of function, and vice versa. We tested the role of miR-137 in regulating Myc levels in the RasV12;scribRNAi, a tumor model of oncogenic cooperation that results in neoplastic tumors. Gain of function of miR-137 in the RasV12;scribRNAi background significantly reduced tumor phenotype as well as Myc levels in the eye. Our studies highlight miR-137 as a post-transcriptional regulator of Myc and a promising therapeutic target for diseases associated with Myc accumulation.