Delta (Dl) is one of the six known zygotic neurogenic genes, each of which is essential for proper segregation of the embryonic ectoderm into neural and epidermal lineages. Molecular analysis of Dl reveals that it is a transcriptionally complex locus that yields multiple maternal and zygotic transcripts. DNA sequence analysis suggests that the predominant product of the locus is a putative transmembrane protein exhibiting homology to blood coagulation factors and epidermal growth factor of vertebrates. The structure of this product is consistent with the hypothesis that Dl participates in cell-cell interactions that are central to establishment of the epidermal lineage within the developing ectoderm. Genetic analyses demonstrate that Dl mutations can modify the imaginal phenotypes that result from heterozygosity for Notch (N) mutations as well as the interaction between particular alleles of Notch (N) and Enhancer of split [E(spl)] two other members of the neurogenic gene set. Vital interactions also occur between Dl and N. Given the structures of products encoded by N, Dl, and E(spl), we suggest that the synergistic phenotypic interactions observed among mutations in these three loci result from physical, as opposed to regulatory, interactions.