Abstract: Groucho is an evolutionarily conserved transcriptional co-repressor and has been implicated in regulating cell proliferation and cell fate decisions in many developmental processes. But whether it has a role in intestinal stem cell lineages is unknown. From an RNAi genetic screen, we identified Groucho as a critical regulator of cell proliferation and differentiation of intestinal stem cells in Drosophila midgut. We find that depleting Groucho in ISCs leads to rapid accumulation of ISC-like cells and failure of enteroendocrine cell differentiation. It is known that Notch signaling activation is essential for ISC differentiation, but loss of Groucho does not compromise Notch pathway activation. Furthermore, ectopic expression of NiCD or the Notch target E (spl) genes fails to induce differentiation of Groucho-depleted ISCs. Together with the analysis on its role in ISC proliferation, we propose that Groucho acts as a co-repressor to regulate the transcriptional output of multiple signaling pathways: Notch signaling to promote ISC differentiation, and EGFR signaling to inhibit ISC proliferation.