rhomboid (rho) encodes a putative transmembrane receptor that is required for the differentiation of the ventral epidermis. It is initially expressed before the completion of cellularization in lateral stripes within the presumptive neuroectoderm. Here, we present evidence that the maternal morphogen dorsal (dl) acts in concert with basic helix-loop-helix (b-HLH) proteins, possibly including twist (twi), to activate rho in both lateral and ventral regions. Expression is blocked in ventral regions (the presumptive mesoderm) by snail (sna), which is also a direct target of the dl morphogen. A 300-bp region of the rho promoter (the NEE), which is sufficient for neuroectoderm expression, contains a cluster of dl and b-HLH activator sites that are closely linked to sna repressor sites. Mutations in these binding sites cause genetically predicted changes in the levels and limits of rho expression. In particular, the disruption of sna-binding sites causes a derepression of the pattern throughout ventral regions, providing evidence that sna is directly responsible for establishing the mesoderm/neuroectoderm boundary before gastrulation. The tight linkage of activator and repressor sites in the rho NEE is similar to the arrangement of binding sites observed in the even-skipped stripe 2 element, which is regulated by bicoid (bcd). This suggests that the dl and bcd morphogens use a similar mechanism to make stripes in the Drosophila embryo.