In Drosophila, the larval prothoracic gland integrates nutritional status with developmental signals to regulate growth and maturation through the secretion of the steroid hormone ecdysone. While the nutritional signals and cellular pathways that regulate prothoracic gland function are relatively well studied, the transcriptional regulators that orchestrate the activity of this tissue remain less characterized. Here, we show that lysine demethylase 5 (KDM5) is essential for prothoracic gland function. Indeed, restoring kdm5 expression only in the prothoracic gland in an otherwise kdm5 null mutant animal is sufficient to rescue both the larval developmental delay and the pupal lethality caused by loss of KDM5. Our studies show that KDM5 functions by promoting the endoreplication of prothoracic gland cells, a process that increases ploidy and is rate limiting for the expression of ecdysone biosynthetic genes. Molecularly, we show that KDM5 activates the expression of the receptor tyrosine kinase torso, which then promotes polyploidization and growth through activation of the MAPK signaling pathway. Taken together, our studies provide key insights into the biological processes regulated by KDM5 and expand our understanding of the transcriptional regulators that coordinate animal development.