Limb development in the Drosophila embryo requires a pattern-forming system to organize positional information along the proximal-distal axis of the limb. This system must function in the context of the well characterized anterior-posterior and dorsal-ventral pattern-forming systems that are required to organize the body plan of the embryo. By genetic criteria the Distal-less gene appears to play a central role in limb development. Lack-of-function Distal-less mutations cause the deletion of a specific subset of embryonic peripheral sense organs that represent the evolutionary remnants of larval limbs. Distal-less activity is also required in the imaginal discs for the development of adult limbs. This requirement is cell autonomous and region specific within the developing limb primordium. Production of genetically mosaic imaginal discs, in which clones of cells lack Distal-less activity, indicates the existence of an organized proximal-distal positional information in very young imaginal disc primordia. We suggest that this graded positional information may depend on the activity of the Distal-less gene.