Yorkie (Yki) is well known as a transcriptional co-activator that functions downstream of the Hippo pathway to positively regulate transcription of genes that promote tissue growth. Recent studies have shown that increased cytoskeletal tension activates both Yki and YAP (a mammalian orthologue of Drosophila yki), resulting in increased nuclear localization and tissue growth. To better understand the effects of tension, as well as upstream pathway activity, on Yki function in living tissues, we generated a tagged yki transgene that is expressed at endogenous levels. Using this Yki reporter, we find that tension, generated either mechanically or genetically, results in increased nuclear Yki accumulation in the wing epithelium. Unexpectedly, we also find that tension induces Yki to accumulate in the cell cortex at the apical junctional region (AJR) in live cells. To ask if Yki might have a previously unrecognized, non-transcriptional function at the cell cortex, we added a myristoylation signal to the Yki N-terminus to tether Yki to the membrane. Remarkably, when expressed transgenically in the wing myristoylated Yki promotes cytoskeletal tension and folding in the epithelium by activating the Drosophila myosin regulatory light chain Spaghetti squash (Sqh). In addition, we found that activating Yki by genetically inactivating the Hippo pathway also causes Yki to accumulate at the AJR and increases Sqh activity. Conversely, depletion of yki using RNAi resulted in reduced Sqh activity. Based on these results, we suggest that active Yki functions in a feed forward ‘amplifier’ loop that promotes cytoskeletal tension, and thereby greater Yki activity, in response to tension such as that generated in the peripheral regions during imaginal disc growth. We are testing this hypothesis by generating yki alleles that lack the ability to activate Sqh, and are also dissecting the molecular mechanism underlying this novel function of Yki.