Actomyosin contractility is critical for organizing various forms of morphogenesis. In some cases, high levels of contractility are important for driving cell shape changes, while in other cases, contractility must be maintained at moderate levels that help guide morphogenetic processes. The mechanisms that induce contractility are well characterized, however, it is not clear how actomyosin networks are counteracted to maintain moderate levels of contractility. Recently, the Arf-GEF Steppke was shown to antagonize actomyosin contractility during cleavage of the early Drosophila embryo. Therefore, we hypothesized that Steppke plays a similar role during later stages of embryogenesis as the ectoderm undergoes various forms of actomyosin driven morphogenesis. We report that Steppke is enriched in areas of high actomyosin contractility throughout embryonic development, including cytokinetic rings and adherens junctions. step zygotic mutant embryos fail head involution, and display a disorganized epithelium beginning at germ band retraction. In contrast to the wildtype tissue in which cells become elongated and aligned along the dorsal-ventral axis. Expression of a Steppke construct can rescue these defects, and its GEF activity is required for normal tissue structure. step mutants display abnormal local increases of actin and myosin levels, as well as increased tissue tension in the ectoderm. Thus, Steppke seems to act locally to antagonize actomyosin activity to promote the orderly spreading of an epithelial sheet. Strikingly, actomyosin activity appears responsible for locally recruiting Step since loss or gain of actomyosin function results in decreased or increased Steppke levels respectively. Taken together, these data suggest a negative feedback loop in which Step is recruited to areas of high actomyosin activity, and antagonizes this activity for tissue plasticity.