The D. melanogaster transformer-2 (tra-2) gene regulates somatic sexual differentiation in females and is necessary for spermatogenesis in males. Wild-type tra-2 function is required for the female-specific splicing of the pre-mRNA of the next known gene (doublesex) downstream of tra-2 in the sex determination regulatory hierarchy. The tra-2 gene was cloned, and P element-mediated transformation was used to demonstrate that a 3.9 kb genomic fragment contains all sequences necessary for tra-2 function. A 1.7 kb transcript was shown to be the product of the tra-2 locus based on its reduced level in flies containing a tra-2 mutant allele. The sequence of a cDNA corresponding to this transcript indicates that it encodes a polypeptide with strong similarity to a family of RNA binding proteins that includes proteins found associated with hnRNPs and snRNPs, suggesting that the tra-2 product may directly regulate the processing of the double-sex pre-mRNA in females.