Cell differentiation in Dictyostelium results in the formation of two cell types, stalk and spore cells. The stalk cells undergo programmed cell death, whereas spore cells retain viability. The current evidence suggests that stalk cell differentiation is induced by Differentiation Inducing Factor (DIF), while spore cell differentiation occurs in response to cAMP. We have discovered the first developmentally regulated Dictyostelium gene, the glycogen phosphorylase gene 2 (gp2) gene, that can be induced by both DIF-1 and cAMP, suggesting the possibility of a new group of developmentally regulated genes that have DIF-1 and cAMP dual responsiveness. The gp2 gene was found to be expressed in both prestalk/stalk cells and prespore/spore cells. The DIF-1 competence of the gp2 gene required uninterrupted development, whereas the cAMP-competence for the gene required only starvation. Both DIF-1 and cAMP induction of the gene could be inhibited by NH3, a factor that is thought to act as a developmental signal in Dictyostelium. Another developmental signal, adenosine, was found to repress the DIF-1 induction of the gp2 gene. Two introns in the gp2 gene were examined for their involvement in the regulation of the gene, but no regulatory function was detected. A model for the regulation of the gp2 gene during the development is proposed.