We report the identification of a Drosophila Pax gene, eye gone (eyg), which is required for eye development. Loss-of-function eyg mutations cause reduction or absence of the eye. Similar to the Pax6 eyeless (ey) gene, ectopic expression of eyg induces extra eye formation, but at sites different from those induced by ey. Several lines of evidence suggest that eyg and ey act cooperatively: (1) eyg expression is not regulated by ey, nor does it regulate ey expression, (2) eyg-induced ectopic morphogenetic furrow formation does not require ey, nor does ey-induced ectopic eye production require eyg, (3) eyg and ey can partially substitute for the function of the other, and (4) coexpression of eyg and ey has a synergistic enhancement of ectopic eye formation. Our results also show that eyg has two major functions: to promote cell proliferation in the eye disc and to promote eye development through suppression of wg transcription.