The torso (tor) gene, one of six identified maternal genes essential for the development of the anterior and posterior terminal structures in the Drosophila embryo, is likely to function as a transmembrane receptor tyrosine kinase. Although tor protein is uniformly distributed in the membrane of the egg cell and syncytial embryo, genetic and molecular data suggest that tor is locally activated at the ends of the embryo by a ligand present in the perivitelline space. Local activation of tor could be achieved if the ligand were expressed by a subpopulation of the follicle cells that surround the developing oocyte. Here we describe torso-like (tsl), the sixth member of the terminal gene class, and show that it is unique among these genes in that its expression is required in the somatic follicle cells rather than in the germ line. Moreover, mosaic analysis demonstrates that tsl expression is necessary only in subpopulations of follicle cells located at the poles of the oocyte. Thus, the spatially regulated expression of tsl in the follicle cell layer may generate a localized signal that is transduced by tor, ultimately resulting in the formation of the terminal structures of the embryo.