doublesex (dsx) encodes sex-specific transcription factors (DSX(F) in females and DSX(M) in males) that act at the bottom of the Drosophila somatic sex determination hierarchy. dsx, which is conserved among diverse taxa, is responsible for directing all aspects of Drosophila somatic sexual differentiation outside the nervous system. The role of dsx in the nervous system remainsminimally understood. Here, the mechanisms by which DSX acts to establish dimorphism in the central nervous system were examined. This study shows that the number of DSX-expressing cells in the central nervous system is sexually dimorphic during both pupal and adult stages. Additionally, the number of DSX-expressing cells depends on both the amount of DSX and the isoform present. One cluster of DSX-expressing neurons in the ventral nerve cord undergoes female-specific cell death that is DSX(F)-dependent. Another DSX-expressing cluster in the posterior brain undergoes more cell divisions in males than in females. Additionally, early in development, DSX(M) is present in a portion of the neural circuitry in which the male-specific product of fruitless (fru) is produced, in a region that has been shown to be critical for sex-specific behaviors. This study demonstrates that DSX(M) and FRU(M) expression patterns are established independent of each other in the regions of the central nervous system examined. In addition to the known role of dsx in establishing sexual dimorphism outside the central nervous system, the results demonstrate that DSX establishes sex-specific differences in neural circuitry by regulating the number of neurons using distinct mechanisms.