The Janus kinase (JAK) pathway is an essential, highly re-utilized developmental signaling cascade found in most metazoans. In vertebrates, the JAK intracellular cascade mediates signaling by dozens of cytokines and growth factors. In Drosophila, the Unpaired (Upd) family, encoded by three tandemly duplicated genes, is the only class of ligands associated with JAK stimulation. Unpaired has a central role in activation of JAK for most pathway functions, while Unpaired 2 regulates body size through insulin signaling. We show here that the third member of the family, unpaired 3 (upd3), overlaps upd in expression in some tissues and is essential for a subset of JAK-mediated developmental functions. First, consistent with the known requirements of JAK signaling in gametogenesis, we find that mutants of upd3 show an age-dependent impairment of fertility in both sexes. In oogenesis, graded JAK activity stimulated by Upd specifies the fates of the somatic follicle cells. As upd3 mutant females age, defects arise that can be attributed to perturbations of the terminal follicle cells, which require the highest levels of JAK activation. Therefore, in oogenesis, the activities of Upd and Upd3 both appear to quantitatively contribute to specification of those follicle cell fates. Furthermore, the sensitization of upd3 mutants to age-related decline in fertility can be used to investigate reproductive senescence. Second, loss of Upd3 during imaginal development results in defects of adult structures, including reduced eye size and abnormal wing and haltere posture. The outstretched wing and small eye phenotypes resemble classical alleles referred to as outstretched (os) mutations that have been previously ascribed to upd. However, we show that os alleles affect expression of both upd and upd3 and map to untranscribed regions, suggesting that they disrupt regulatory elements shared by both genes. Thus the upd region serves as a genetically tractable model for coordinate regulation of tandemly duplicated gene families that are commonly found in higher eukaryotes.