Two different compartments support germline stem cell (GSC) self-renewal and their timely differentiation: the classical niche provides maintenance cues, while a differentiation compartment, formed by somatic escort cells (ECs), is required for proper GSC differentiation. ECs extend long protrusions that invade between tightly packed germ cells, and alternate between encapsulating and releasing them. How ECs achieve this dynamic balance has not been resolved. By combining live imaging and genetic analyses in Drosophila, we have characterised EC shapes and their dynamic changes. We show that germ cell encapsulation by ECs is a communal phenomenon, whereby EC-EC contacts stabilise an extensive meshwork of protrusions. We further show that Signal Transducer and Activator of Transcription (Stat) and Epidermal Growth Factor Receptor (Egfr) signalling sustain EC protrusiveness and flexibility by combinatorially affecting the activity of different RhoGTPases. Our results reveal how a complex signalling network can determine the shape of a cell and its dynamic behaviour. It also explains how the differentiation compartment can establish extensive contacts with germ cells, while allowing a continual posterior movement of differentiating GSC daughters.