Drosophila neuroendocrine cells comprising the corpora cardiaca (CC) are essential for systemic glucose regulation and represent functional orthologues of vertebrate pancreatic α-cells. Although Drosophila CC cells have been regarded as developmental orthologues of pituitary gland, the genetic regulation of CC development is poorly understood. From a genetic screen, we identified multiple novel regulators of CC development, including Notch signaling factors. Our studies demonstrate that the disruption of Notch signaling can lead to the expansion of CC cells. Live imaging demonstrates localized emergence of extra precursor cells as the basis of CC expansion in Notch mutants. Contrary to a recent report, we unexpectedly found that CC cells originate from head mesoderm. We show that Tinman expression in head mesoderm is regulated by Notch signaling and that the combination of Daughterless and Tinman is sufficient for ectopic CC specification in mesoderm. Understanding the cellular, genetic, signaling, and transcriptional basis of CC cell specification and expansion should accelerate discovery of molecular mechanisms regulating ontogeny of organs that control metabolism.