A pair of the Drosophila eye-antennal disc gives rise to four distinct organs (eyes, antennae, maxillary palps, and ocelli) and surrounding head cuticle. Developmental processes of this imaginal disc provide an excellent model system to study the mechanism of regional specification and subsequent organogenesis. The dorsal head capsule (vertex) of adult Drosophila is divided into three morphologically distinct subdomains: ocellar, frons, and orbital. The homeobox gene orthodenticle (otd) is required for head vertex development, and mutations that reduce or abolish otd expression in the vertex primordium lead to ocelliless flies. The homeodomain-containing transcriptional repressor Engrailed (En) is also involved in ocellar specification, and the En expression is completely lost in otd mutants. However, the molecular mechanism of ocellar specification remains elusive. Here, we provide evidence that the homeobox gene defective proventriculus (dve) is a downstream effector of Otd, and also that the repressor activity of Dve is required for en activation through a relief-of-repression mechanism. Furthermore, the Dve activity is involved in repression of the frons identity in an incoherent feedforward loop of Otd and Dve.