Previously, it has been shown that, during early Drosophila and C. elegans development, the germ cell precursors undergo a period of transcriptional quiescence. Here, we report that Germ cell-less (GCL), a germ plasm component necessary for the proper formation of "pole cells," the germ cell precursors in Drosophila, is required for the establishment of this transcriptional quiescence. While control embryos silence transcription prior to pole cell formation in the pole cell-destined nuclei, this silencing does not occur in embryos that lack GCL activity. The failure to establish quiescence is tightly correlated with failure to form the pole cells. Furthermore, we show that GCL can repress transcription of at least a subset of genes in an ectopic context, independent of other germ plasm components. Our results place GCL as the earliest gene known to act in the transcriptional repression of the germline. GCL's subcellular distribution on the nucleoplasmic surface of the nuclear envelope and its effect on transcription suggest that it may act to repress transcription in a manner similar to that proposed for transcriptional silencing of telomeric regions.