A key aim of neurodevelopmental research is to understand how precursor cells decide to stop dividing and commence their terminal differentiation at the correct time and place. Here, we show that minibrain (mnb), the Drosophila ortholog of the Down syndrome candidate gene DYRK1A, is transiently expressed in newborn neuronal precursors known as ganglion cells (GCs). Mnb promotes the cell cycle exit of GCs through a dual mechanism that regulates the expression of the cyclin-dependent kinase inhibitor Dacapo, the homolog of vertebrate p27Kip1 (Cdkn1b). Mnb upregulates the expression of the proneural transcription factor (TF) Asense, which promotes Dacapo expression. Mnb also induces the expression of Prospero, a homeodomain TF that in turn inhibits the expression of Deadpan, a pan-neural TF that represses dacapo. In addition to its effects on Asense and Prospero, Mnb also promotes the expression of the neuronal-specific RNA regulator Elav, strongly suggesting that Mnb facilitates neuronal differentiation. These actions of Mnb ensure the precise timing of neuronal birth, coupling the mechanisms that regulate neurogenesis, cell cycle control and terminal differentiation of neurons.