A comparison of the patterns of expression of AS-C (T3) RNA and protein suggests that an important level of regulation occurs post- transcriptionally. First, when the RNA is abundant in the early embryo the protein is barely detectable. Later, the protein starts to accumulate in only a subset of the nuclei of those cells expressing the RNA. Only the cells in the subsets become the neuroblasts. This post- transcriptional regulation is suppressed in embryos mutant for the genes Notch and Delta; where all cells expressing RNA accumulate protein. These findings suggest that deployment of T3 protein expression is one of the causal factors that assigns specific fates to the neuroblasts and, in consequence, a basis for the mechanism of lateral inhibition is proposed.