The rough mutation in Drosophila disrupts an early stage of ommatidial assembly in the developing eye imaginal disc. Analysis of somatic mosaics suggests that rough gene function is required only in photoreceptors R2 and R5. However, these cells apparently differentiate normally in mutant eye discs and it is the cells that are subsequently added to the ommatidium that behave aberrantly. The rough gene was isolated by P-element transposon tagging, and the mutant can be rescued by transformation with an 8.6 kb genomic fragment. The rough transcription unit is 4.3 kb and consists of three exons that are joined in a 1.3 kb mRNA. The predicted rough protein is 350 amino acids long and contains a homeobox. Taken together, our results suggest that the role of the rough gene product may be to regulate the sending of signals by photoreceptors R2 and R5 to their neighbors in the developing ommatidia.