Krüppel (Kr) encodes a zinc finger-type transcription factor expressed in spatially and temporally restricted patterns during Drosophila embryogenesis. Molecular targets and the mechanism of Kr action have been studied extensively during the early segmentation process, but only little is known about Kr requirement during later development. We report the identification of a target gene of Kr, termed knockout (ko), isolated by virtue of Krüppel in vitro binding sites. Loss and gain of function experiments show that Kr activity maintains ko expression in a subset of muscles. ko encodes a novel protein expressed in several embryonic tissues including Kr-expressing muscles. Movements of embryos deficient for ko activity are uncoordinated. Their muscle pattern is normal, but the patterns of neuromuscular innervation are specifically disarranged. The results suggest that the Kr target gene ko is required for proper innervation of specific muscles by RP motoneurons.