serpent (srp) encodes a GATA-factor that controls various aspects of embryogenesis in Drosophila, such as fatbody development, gut differentiation and hematopoiesis. During hematopoiesis, srp expression is required in the embryonic head mesoderm and the larval lymph gland, the two known hematopoietic tissues of Drosophila, to obtain mature hemocytes. srp expression in the hemocyte primordium is known to depend on snail and buttonhead, but the regulatory complexity that defines the primordium has not been addressed yet. Here, we find that srp is sufficient to transform trunk mesoderm into hemocytes. We identify two disjoint cis-regulatory modules that direct the early expression in the hemocyte primordium and the late expression in mature hemocytes and lymph gland, respectively. During embryonic hematopoiesis, a combination of snail, buttonhead, empty spiracles and even-skipped confines the mesodermal srp expression to the head region. This restriction to the head mesoderm is crucial as ectopic srp in mesodermal precursors interferes with the development of mesodermal derivates and promotes hemocytes and fatbody development. Thus, several genes work in a combined fashion to restrain early srp expression to the head mesoderm in order to prevent expansion of the hemocyte primordium.