Innate lymphoid cells (ILCs) are a recently described family of lymphoid effector cells that have important roles in immune defence, inflammation and tissue remodelling. It has been proposed that ILCs represent 'innate' homologues of differentiated effector T cells, and they have been categorized into three groups — namely, ILC1s, ILC2s and ILC3s — on the basis of their expression of cytokines and transcription factors that are typically associated with T helper 1 (T(H)1)-, T(H)2- and T(H)17-type immune responses, respectively. Indeed, remarkable similarity is seen between the specific transcription factors required for the development and diversification of different ILC groups and those that drive effector T cell differentiation. The recent identification of dedicated ILC precursors has provided a view of the mechanisms that control this first essential stage of ILC development. Here, we discuss the transcriptional mechanisms that regulate ILC development and diversification into distinct effector subsets with key roles in immunity and tissue homeostasis. We further caution against the current distinction between 'helper' versus 'killer' subsets in the evolving area of ILC nomenclature.