Oogenesis in Drosophila involves specification of both germ cells and the surrounding somatic follicle cells, as well as the determination of oocyte polarity. We found that two neurogenic genes, Notch and Delta, are required in oogenesis. These genes encode membrane proteins with epidermal growth factor repeats and are essential in the decision of an embryonic ectodermal cell to take on the fate of neuroblast or epidermoblast. In oogenesis, mutation in either gene leads to an excess of posterior follicle cells, a cell fate change reminiscent of the hyperplasia of neuroblasts seen in neurogenic mutant embryos. Furthermore, the Notch mutation in somatic cells causes mislocalization of bicoid in the oocyte. These results suggest that the neurogenic genes Notch and Delta are involved in both follicle cell development and the establishment of anterior-posterior polarity in the oocyte.