In the embryonic midgut of Drosophila, Wingless (Wg) signaling elicits threshold-specific transcriptional response, that is, low-signaling levels activate target genes, whereas high-signaling levels repress them. Wg-mediated repression of the HOX gene Ultrabithorax (Ubx) is conferred by a response sequence within the Ubx B midgut enhancer, called WRS-R. It further depends on the Teashirt (Tsh) repressor, which acts through the WRS-R without binding to it. Here, we show that Wg-mediated repression of Ubx B depends on Brinker, which binds to the WRS-R. Furthermore, Brinker blocks transcriptional activation by ubiquitous Wg signaling. Brinker binds to Tsh in vitro, recruits Tsh to the WRS-R, and we find mutual physical interactions between Brinker, Tsh, and the corepressor dCtBP. This suggests that the three proteins may form a ternary repressor complex at the WRS-R to quench the activity of the nearby-bound dTCF/Armadillo transcription complex. Finally, brinker and tsh produce similar mutant phenotypes in the ventral epidermis, and double mutants mimic overactive Wg signaling in this tissue. This suggests that Brinker may have a widespread function in antagonizing Wg signaling.