Proliferation in imaginal discs requires cell growth and is linked to patterning processes controlled by secreted cell-signalling molecules. To identify new genes involved in the control of cell proliferation we have screened a collection of P-lacW insertion mutants that result in lethality in the larval/pupal stages, and characterized a novel gene, patufet (ptuf). Inactivation of ptuf by a P element insertion in the 5' untranslated region leads to aberrant imaginal disc morphology characterized by a reduction in mass of discs and disorganization of disc cells where no folding or patterning can be detected. Moreover, apoptotic cells can be observed in these small and abnormal mutant discs. To examine the role of ptuf we have studied its clonal behaviour in genetic mosaics generated by mitotic recombination. The mutation causes reduced cell viability, smaller cell size and stops vein differentiation. Non-autonomous effects, such as abnormal differentiation of wild-type cells surrounding the clones, are also observed. We have cloned the ptuf gene of Drosophila melanogaster and found that it encodes a selenophosphate synthetase, which is the first identified in insects. Mutant flies transformed with the full-length cDNA show complete reversion of lethality and disc phenotype. Northern blot analysis and in situ hybridization indicate that the ptuf gene is expressed in imaginal discs as well as at different stages of development. The synthesis of selenoproteins by the selenophosphate synthetase, the role of selenoproteins in the maintenance of the oxidant/antioxidant balance of the cell and its possible implications in imaginal disc morphogenesis are discussed.