Anterior-posterior axis formation in the Drosophila oocyte requires activation of the EGF receptor (EGFR) pathway in the posterior follicle cells (PFC), where it also redirects them from the default anterior to the posterior cell fate. The relationship between EGFR activity in the PFC and oocyte polarity is unclear, because no EGFR-induced changes in the PFC have been observed that subsequently affect oocyte polarity. Here, we show that an extracellular matrix receptor, Dystroglycan, is down-regulated in the PFC by EGFR signaling, and this down-regulation is necessary for proper localization of posterior polarity determinants in the oocyte. Failure to down-regulate Dystroglycan disrupts apicobasal polarity in the PFC, which includes mislocalization of the extracellular matrix component Laminin. Our data indicate that Dystroglycan links EGFR-induced repression of the anterior follicle cell fate and anterior-posterior polarity formation in the oocyte.