The doublesex (dsx) gene of Drosophila melanogaster encodes both male-specific and female-specific polypeptides, whose synthesis is regulated by alternative sex-specific splicing of the primary dsx transcript. The alternative splicing of the dsx mRNA is the last known step in a cascade of regulatory gene interactions that involves both transcriptional and post-transcriptional mechanisms. Genetic studies have shown that the products of the dsx locus are required for correct somatic sexual differentiation of both sexes, and have suggested that each dsx product functions by repressing expression of terminal differentiation genes specific to the opposite sex. However, these studies have not shown whether the dsx gene products function directly to regulate the expression of target genes, or indirectly through another regulatory gene. We report here that the male- and female-specific DSX proteins, expressed in E.coli, bind directly and specifically in vitro to three DNA sequences located in an enhancer region that regulates female-specific expression of two target genes, the yolk protein genes 1 and 2. This result suggests strongly that dsx is a final regulatory gene in the hierarchy of regulatory genes controlling somatic sexual differentiation.