The cut locus (ct) codes for a homeodomain protein (Cut) and controls the identity of a subset of cells in the peripheral nervous system in Drosophila. During a screen to identify ct-interacting genes, we observed that flies containing a hypomorphic ct mutation and a heterozygous deletion of the Antennapedia complex exhibit a transformation of mouthparts into leg and antennal structures similar to that seen in homozygous proboscipedia (pb) mutants. The same phenotype is produced with all heterozygous pb alleles tested and is fully penetrant in two different ct mutant backgrounds. We show that this phenotype is accompanied by pronounced changes in the expression patterns of both ct and pb in labial discs. Furthermore, a significant proportion of ct mutant flies that are heterozygous for certain Antennapedia (Antp) alleles have thoracic defects that mimic loss-of-function Antp phenotypes, and ectopic expression of Cut in antennal discs results in ectopic Antp expression and a dominant Antp-like phenotype. Our results implicate ct in the regulation of expression and/or function of two homeotic genes and document a new role of ct in the control of segmental identity.