The concept of an equivalence group, a cluster of cells with equal potential to adopt the same specific fate, has served as a useful paradigm to understand neural cell type specification. In the Drosophila eye, a set of five cells, called the 'R7 equivalence group', generates a single photoreceptor neuron and four lens-secreting epithelial cells. This choice between neuronal versus non-neuronal cell fates rests on differential requirements for, and cross-talk between, Notch/Delta- and Ras/mitogen-activated protein kinase (MAPK)-dependent signaling pathways. However, many questions remain unanswered related to how downstream events of these two signaling pathways mediate distinct cell fate decisions.Here, we demonstrate that two direct downstream targets of Ras and Notch signaling, the transcription factors Prospero and dPax2, are essential regulators of neuronal versus non-neuronal cell fate decisions in the R7 equivalence group. Prospero controls high activated MAPK levels required for neuronal fate, whereas dPax2 represses Delta expression to prevent neuronal fate. Importantly, activity from both factors is required for proper cell fate decisions to occur.These data demonstrate that Ras and Notch signaling are integrated during cell fate decisions within the R7 equivalence group through the combinatorial and opposing activities of Pros and dPax2. Our study provides one of the first examples of how the differential expression and synergistic roles of two independent transcription factors determine cell fate within an equivalence group. Since the integration of Ras and Notch signaling is associated with many developmental and cancer models, these findings should provide new insights into how cell specificity is achieved by ubiquitously used signaling pathways in diverse biological contexts.