The Pax-6 gene encodes a transcription factor with two DNA-binding domains, a paired and a homeodomain, and is expressed during eye morphogenesis and development of the nervous system. Pax-6 homologs have been isolated from a wide variety of organisms ranging from flatworms to humans. Since loss-of-function mutants in insects and mammals lead to an eyeless phenotype and Pax-6 orthologs from distantly related species are capable of inducing ectopic eyes in Drosophila, we have proposed that Pax-6 is a universal master control gene for eye morphogenesis. To determine the extent of evolutionary conservation of the eye morphogenetic pathway, we have begun to identify subordinate target genes of Pax-6. Previously we have shown that expression of two genes, sine oculis (so) and eyes absent (eya), is induced by eyeless (ey), the Pax-6 homolog of Drosophila. Here we present evidence from ectopic expression studies in transgenic flies, from transcription activation studies in yeast, and from gel shift assays in vitro that the EY protein activates transcription of sine oculis by direct interaction with an eye-specific enhancer in the long intron of the so gene