Neurons and glia are often derived from common multipotent stem cells. In Drosophila, neural identity appears to be the default fate of these precursors. Stem cells that generate either neurons or glia transiently express neural stem cell-specific markers. Further development as glia requires the activation of glial-specific regulators. However, this must be accompanied by simultaneous repression of the alternate neural fate. I show that the Drosophila transcriptional repressor Tramtrack is a key repressor of neuronal fates. It is expressed at high levels in all mature glia of the embryonic central nervous system. Analysis of the temporal profile of Tramtrack expression in glia shows that it follows that of existing glial markers. When expressed ectopically before neural stem cell formation, Tramtrack represses the neural stem cell-specific genes asense and deadpan. Surprisingly, Tramtrack protein levels oscillate in a cell cycle-dependent manner in proliferating glia, with expression dropping before replication, but re-initiating after S phase. Overexpression of Tramtrack blocks glial development by inhibiting S-phase and repressing expression of the S-phase cyclin, cyclin E. Conversely, in tramtrack mutant embryos, glia are disrupted and undergo additional rounds of replication. I propose that Tramtrack ensures stable mature glial identity by both repressing neuroblast-specific genes and controlling glial cell proliferation.