Abstract In Drosophila, compatibility between the sexually differentiated state of the soma and the sex chromosome constitution of the germline is required for normal gametogenesis. In this study, we defined important aspects of the soma-germline interactions controlling early oogenesis. In particular, the sex-specific germline activity of the ovarian tumor promoter was found to be dependent upon somatic factors controlled by the somatic sex differentiation gene transformer. This regulation defines whether there is sufficient ovarian tumor expression in adult XX germ cells to support oogenesis. In addition, the ovarian tumor function required for female germline differentiation is dependent on the activity of another germline gene, ovo, whose regulation is transformer-independent. These and other data indicate that ovarian tumor plays a central role in coordinating regulatory inputs from the soma (as regulated by transformer) with those from the germline (involving ovo). We also demonstrate that transformer-dependent interactions influence whether XX germ cells require ovarian tumor or ovo functions to undergo early gametogenic differentiation. These results are incorporated into a model hypothesizing that the functions of ovarian tumor and ovo are dependent on an early sex determination decision in the XX germline that is at least partially controlled by somatic transformer activity.