Organ morphogenesis requires the coordinated activity of many mechanisms involved in cell rearrangements, size control, cell proliferation and organ integrity. Here we report that Lachesin (Lac), a cell surface protein, is required for the proper morphogenesis of the Drosophila tracheal system. Homozygous embryos for Lac mutations, which we find fail to complement the previous identified bulbous (bulb) mutation, display convoluted tracheal tubes and tube breaks. At the cellular level, we can detect enlarged cells, suggesting that Lac regulates organ size by influencing cell length rather than cell number, and cell detachments,indicating a role for Lac in cell adhesion. Results from an in vitro assay further support that Lac behaves as a homophilic cell adhesion molecule. Lac co-localizes with Septate Junction (SJ) proteins, and ultrastructural analysis confirms that it accumulates specifically at this type of cellular junction. In Lac mutant embryos, previously characterized components of the SJs are mislocalized, indicating that the proper organization of SJs requires Lac function. In addition, mutations in genes encoding other components of the SJs produce a similar tracheal phenotype. These results point out a new role of the SJs in morphogenesis regulating cell adhesion and cell size.