BMP-dependent patterning in the Drosophila melanogaster wing imaginal disc serves as a paradigm to understand how morphogens specify cell fates. The observed profile of the transcriptional response to the graded signal of BMP relies upon two counter-active gradients of pMad and Brinker (Brk). This patterning model is inadequate to explain the expression of target genes, like vestigial and spalt, in lateral regions of the wing disc where BMP signals decline and Brk levels peak. Here, we show that in contrast to the reciprocal repressor gradient mechanism, where Brk represses BMP targets in medial regions, target expression in lateral regions is downregulated by BMP signalling and activated by Brk. Brk induces lateral expression indirectly, apparently through repression of a negative regulator. Our findings provide a model explaining how the expression of an established BMP target is differentially and inversely regulated along the anterior-posterior axis of the wing disc.