The steroid hormone Ecdysone is crucial for developmental cell death, proliferation and morphogenesis in Drosophila. Herein, we delineate a molecular pathway linking Ecdysone signalling to cell cycle regulation in the Drosophila developing wing. We present evidence that the Ecdysone-inducible zinc-finger transcription factor Crol provides a crucial link between the Ecdysone steroid hormone pathway and the Wingless (Wg) signalling pathway in Drosophila. We identified Crol as a strong enhancer of a wing phenotype generated by overexpression of the Wg-inducible cell cycle inhibitor Hfp. We demonstrate that Crol is required for cell cycle progression: crol mutant clones have reduced cell cycles and are removed by apoptosis, while upregulation of Crol overrides the Wg-mediated developmental cell cycle arrest in the zone of non-proliferating cells in the wing disc. Furthermore, we show that Crol acts to repress wg transcription. We also show that overexpression of crol results in downregulation of Hfp, consistent with the identification of the crol mutant as a dominant enhancer of the Hfp overexpression phenotype. Taken together, our studies have revealed a novel mechanism for cell cycle regulation, whereby Crol links steroid hormone signals to Wg signalling and the regulation of crucial cell cycle targets.