TORC1 regulates growth and metabolism, in part, by influencing transcriptional programs. Here, we identify REPTOR and REPTOR-BP as transcription factors downstream of TORC1 that are required for ∼90% of the transcriptional induction that occurs upon TORC1 inhibition in Drosophila. Thus, REPTOR and REPTOR-BP are major effectors of the transcriptional stress response induced upon TORC1 inhibition, analogous to the role of FOXO downstream of Akt. We find that, when TORC1 is active, it phosphorylates REPTOR on Ser527 and Ser530, leading to REPTOR cytoplasmic retention. Upon TORC1 inhibition, REPTOR becomes dephosphorylated in a PP2A-dependent manner, shuttles into the nucleus, joins its partner REPTOR-BP to bind target genes, and activates their transcription. In vivo functional analysis using knockout flies reveals that REPTOR and REPTOR-BP play critical roles in maintaining energy homeostasis and promoting animal survival upon nutrient restriction.