The pathway that controls sex in Drosophila has been well characterized. The elements of this genetic hierarchy act cell-autonomously in somatic cells. We have previously shown that the sex of germ cells is determined by a different mechanism and that somatic and autonomously acting elements interact to control the choice between spermatogenesis and oogenesis. A target for both types of signals is the enhancer-trap mgm1, which monitors male-specific gene expression in germ cells. Here we report that mgm1 reflects the expression of escargot (esg), a member of the snail gene family, which are transcription factors with zink finger motifs. Genes of this family partially redundantly control a number of processes involving cell fate choices. The regulation of gene expression in germ cells by sex-specific esg enhancers is already seen in embryos. Therefore, autonomous and non-autonomous sex-specific factors that participate in germline sex determination are already present at this early stage. esg is expressed in the male gonad, both in somatic cells and in germline stem cells. We show that esg expression in the male germline is not required for proper sex determination and spermatogenesis, as functional sperm is differentiated by mutant germ cells in wild type hosts. However, somatic esg expression is required for the maintenance of male germline stem cells.