Niche cells exercise elaborate control over the behavior of many tissue-specific stem cells. However, in no system do we fully understand how niche cells are specified, develop and then begin producing the signals necessary to properly regulate stem cells. Here, we take advantage of the paradigmatic stem cell-niche system of the Drosophila testis to address these fundamental questions. We first find that the Notch signaling pathway is necessary for niche cell specification and that its activity in precursor cells prevents those cells from adopting the alternative somatic cyst cell fate. We also discover that the Notch-activating ligand, Delta, is presented from the neighboring endoderm, rather than from within the gonad “proper.” Moreover, we show that niche specification occurs very early during gonadogenesis, before the expression of extant niche cell markers.

We also uncover a role for the bowl pathway in influencing niche cell specification, where bowl promotes niche cell fate, while its antagonist, lines, promotes cyst cell fate. Additionally, we present data suggesting that bowl functions as a transcriptional repressor to restrict cyst cell gene expression in precursor cells, thereby inducing niche cell specification. Ultimately since niche cells influence stem cell behavior, understanding how niche cells develop and dissecting the interactions between niches and their resident stem cells is paramount if we seek to use stem cells as tools in regenerative medicine.