Tissue growth during animal development is tightly controlled so that the organism can develop harmoniously. The salvador (sav) gene, which encodes a scaffold protein, has been shown to restrict cell number by coordinating cell-cycle exit and apoptosis during Drosophila development. Here we identify Hippo (Hpo), the Drosophila orthologue of the mammalian MST1 and MST2 serine/threonine kinases, as a partner of Sav. Loss of hpo function leads to sav-like phenotypes, whereas gain of hpo function results in the opposite phenotype. Whereas Sav and Hpo normally restrict cellular quantities of the Drosophila inhibitor of apoptosis protein DIAP1, overexpression of Hpo destabilizes DIAP1 in cell culture. We show that DIAP1 is phosphorylated in a Hpo-dependent manner in S2 cells and that Hpo can phosphorylate DIAP1 in vitro. Thus, Hpo may promote apoptosis by reducing cellular amounts of DIAP1. In addition, we show that Sav is an unstable protein that is stabilized by Hpo. We propose that Hpo and Sav function together to restrict tissue growth in vivo.