SUMMARYHLH54F, the Drosophila ortholog of the vertebrate basic helix-loop-helix domain-encoding genes capsulin and musculin, is expressed in the founder cells and developing muscle fibers of the longitudinal midgut muscles. These cells descend from the posterior-most portion of the mesoderm, termed the caudal visceral mesoderm (CVM), and migrate onto the trunk visceral mesoderm prior to undergoing myoblast fusion and muscle fiber formation. We show that HLH54F expression in the CVM is regulated by a combination of terminal patterning genes and snail. We generated HLH54F mutations and show that this gene is crucial for the specification, migration and survival of the CVM cells and the longitudinal midgut muscle founders. HLH54F mutant embryos, larvae, and adults lack all longitudinal midgut muscles, which causes defects in gut morphology and integrity. The function of HLH54F as a direct activator of gene expression is exemplified by our analysis of a CVM-specific enhancer from the Dorsocross locus, which requires combined inputs from HLH54F and Biniou in a feed-forward fashion. We conclude that HLH54F is the earliest specific regulator of CVM development and that it plays a pivotal role in all major aspects of development and differentiation of this largely twist-independent population of mesodermal cells.