The developing brain of Drosophila has become a useful model for studying the molecular genetic mechanisms that give rise to the complex neuronal arrays that characterize higher brains in other animals including mammals. Brain development in Drosophila begins during embryogenesis and continues during a subsequent postembryonic phase. During embryogenesis, the Hox gene labial is expressed in the developing tritocerebrum, and labial loss-of-function has been shown to be associated with a loss of regional neuronal identity and severe patterning defects in this part of the brain. However, nothing is known about the expression and function of labial, or any other Hox gene, during the postembryonic phase of brain development, when the majority of the neurons in the adult brain are generated. Here we report the first analysis of Hox gene action during postembryonic brain development in Drosophila. We show that labial is expressed initially in six larval brain neuroblasts, of which only four give rise to the labial expressing neuroblast lineages present in the late larval brain. Although MARCM-based clonal mutation of labial in these four neuroblast lineages does not result in an obvious phenotype, a striking and unexpected effect of clonal labial loss-of-function does occur during postembryonic brain development, namely the formation of two ectopic neuroblast lineages that are not present in wildtype brains. The same two ectopic neuroblast lineages are also observed following cell death blockage and, significantly, in this case the resulting ectopic lineages are Labial-positive. These findings imply that labial is required in two specific neuroblast lineages of the wildtype brain for the appropriate termination of proliferation through programmed cell death. Our analysis of labial function reveals a novel cell autonomous role of this Hox gene in shaping the lineage architecture of the brain during postembryonic development.