Different specialized cell types arise from common progenitors many times during development. In the Drosophila eye, for example, the different subsets of photoreceptor cells (PRs) needed for colour discrimination arise from the R7 and R8 neuronal precursors. Xie and co-workers now report that the transcription factor Senseless (Sens) acts as molecular switch for PR differentiation in Drosophila (see p. 4243). Recent studies have shown that the transcription factor Prospero (Pros) represses R8-related characteristics in R7-based PRs. Xie et al. now extend these studies by showing that sens can both induce R8-like characteristics and repress R7-related features in terminally differentiating PRs in vivo. They also show that Pros and Sens function with the transcription factor Orthodenticle to oppositely regulate the expression of R7- and R8-specific rhodopsins in vitro. Since pros and sens are expressed in similar but distinct cell types in many developing tissues, antagonistic pros/sens regulation of gene expression may help to create cellular diversity in many developmental contexts.