The Drosophila expanded (ex) gene encodes a product (Ex) that shares homology with the Protein 4.1 family of proteins, many of which are enriched at specific lateral cell junctions and the apical cellular domain. Ex colocalizes with actin in the apical domain of imaginal disc epithelial cells, where it partially overlaps the distribution of phosphotyrosine (PY)-containing proteins. This suggests that Ex is present in or associated with adherens junctions. Genetic studies show that Ex is necessary for proper regulation of final cell number in adult wings and for the formation of eyes, distal leg, and distal antennal segments. We have generated mitotic clones that lack Ex using the twin spot technique, and demonstrated that the primary function of Ex is to regulate cell proliferation. Overexpressing Ex protein results in a decrease in final cell number in wings, suggesting a direct relationship between Ex function and proliferation rate.