The Notch receptor is involved in many cell fate determination events in vertebrates and invertebrates. It has been shown in Drosophila melanogaster that Delta-dependent Notch signaling activates the transcription factor Suppressor of Hairless, leading to an increased expression of the Enhancer of Splitgenes. Genetic evidence has also implicated the kuzbaniangene, which encodes a disintegrin metalloprotease, in the Notch signaling pathway. By using a two-cell coculture assay, we show here that vertebrate Dl-1 activates the Notch-1 cascade. Consistent with previous data obtained with active forms of Notch-1 aHES-1-derived promoter construct is transactivated in cells expressing Notch-1 in response to Dl-1 stimulation. Impairing the proteolytic maturation of the full-length receptor leads to a decrease in HES-1 transactivation, further supporting the hypothesis that only mature processed Notch is expressed at the cell surface and activated by its ligand. Furthermore, we observed that Dl-1-inducedHES-1 transactivation was dependent both on Kuzbanian and RBP-J activities, consistent with the involvement of these two proteins in Notch signaling in Drosophila. We also observed that exposure of Notch-1-expressing cells to Dl-1 results in an increased level of endogenous HES-1 mRNA. Finally, coculture of Dl-1-expressing cells with myogenic C2 cells suppresses differentiation of C2 cells into myotubes, as previously demonstrated for Jagged-1 and Jagged-2, and also leads to an increased level of endogenousHES-1 mRNA. Thus, Dl-1 behaves as a functional ligand for Notch-1 and has the same ability to suppress cell differentiation as the Jagged proteins do.