The genes for a DNA replication-related element-binding factor (DREF) were isolated from Drosophila melanogaster and Drosophila virilis, and their nucleotide sequences were determined. Drosophila virilis DREF consists of 742 amino acid residues, which is 33 amino acids longer than D.melanogaster DREF. Comparison of the amino acid sequences revealed that D.virilis DREF is 71% identical to its D. melanogaster homolog. Three highly conserved regions were identified at amino acid positions 14-182 (CR1), 432-568 (CR2) and 636-730 (CR3) of the D.virilis DREF, with 86.4, 86.1 and 83.3% identities, respectively. Transgenic flies in which expression of three conserved regions of D.melanogaster DREF was targeted to the eye imaginal disc were established. Expression of CR1 in the developing eye imaginal discs resulted in a severe rough eye phenotype in adult flies. Expression of CR3 also caused a rough eye phenotype, while that of CR2 had no apparent effect on eye morphology. Expression of either CR1 or CR3 in eye imaginal disc cells inhibited cell cycle progression and reduced incorporation of 5-bromo-2'-deoxyuridine into the S-phase zone (the second mitotic wave) behind the morphogenetic furrow. The results indicate that both CR1 and CR3 are important for DREF functions.