The Broad-Complex (BR-C) appears to encode factors that mediate ecdysone effects during the larva-adult transition. The main goal of this study was to gain insight into what roles the BR-C might play during oogenesis. The main findings are as follows. First, as determined by heteroallele studies and clonal analysis, de12 is a somatic line mutation that appears to fall into the broad domain of the BR-C. Second, the de12 mutation is associated with the insertion of the gypsy transposon at position 169.5 (Chao and Guild, Embo J, 1986, 5:143-150) in the BR-C domain. In its new context this gypsy element exhibits ovarian-specific activation. Both this gypsy activation and the de12 phenotype are partially suppressible by su(f) and su(Hw). Third, we have identified a set of transcripts that cross-hybridize with BR-C sequence spanning the gypsy insertion site (166-179). There are significant differences in these cross-hybridizing species, both in size and relative abundance, between de12 and its parent strain. Finally we have determined that in de12 there is a premature arrest of chorion gene amplification in the late stages of oogenesis.