Ligands of the Delta/Serrate/lag-2 (DSL) family and their receptors, members of the lin-12/Notch family, mediate cell-cell interactions that specify cell fate in invertebrates and vertebrates. In C. elegans, two DSL genes, lag-2 and apx-1, influence different cell fate decisions during development. Here we show that APX-1 can fully substitute for LAG-2 when expressed under the control of lag-2 regulatory sequences. In addition, we demonstrate that truncated forms lacking the transmembrane and intracellular domains of both LAG-2 and APX-1 can also substitute for endogenous lag-2 activity. Moreover, we provide evidence that these truncated forms are secreted and able to activate LIN-12 and GLP-1 ectopically. Finally, we show that expression of a secreted DSL domain alone may enhance endogenous LAG-2 signalling. Our data suggest ways that activated forms of DSL ligands in other systems may be created.