Regeneration is a vital process to maintain and repair tissues. Despite the importance of regeneration, the genes responsible for regenerative growth remain largely unknown. In Drosophila, imaginal disc regeneration can be induced either by fragmentation and in vivo culture or in situ by ubiquitous expression of wingless (wg/wnt1). Imaginal discs, like appendages in lower vertebrates, initiate regeneration by wound healing and proliferation at the wound site, forming a regeneration blastema. Most blastema cells maintain their disc-specific identity during regeneration; a few cells however, exhibit stem-cell like properties and switch to a different fate, in a phenomenon known as transdetermination. We identified three genes, regeneration (rgn), augmenter of liver regeneration (alr) and Matrix metalloproteinase-1 (Mmp1) expressed specifically in blastema cells during disc regeneration. Mutations in these genes affect both fragmentation- and wg-induced regeneration by either delaying, reducing or positioning the regeneration blastema. In addition to the modifications of blastema homeostasis, mutations in the three genes alter the rate of regeneration-induced transdetermination. We propose that these genes function in regenerative proliferation, growth and regulate cellular plasticity.