Environmental signals can activate neuro-endocrine cascades that regulate various physiological processes. In the present study, we demonstrate that two responses to environmental stress signaling in the crustacean Daphnia magna -hemoglobin accumulation and male offspring production -are co-elevated by the crustacean terpenoid hormone methyl farnesoate and several synthetic analogs. Potency of the hormones with respect to the induction of both hemoglobin and male offspring was highly correlated, suggesting that both processes are regulated by the same terpenoid signaling pathway. Six clones of the D. pulex/pulicaria species complex that were previously characterized as unable to produce male offspring and five clones that were capable of producing males were evaluated for both hemoglobin induction and male offspring production in response to methyl farnesoate. Four of the five male-producing clones produced both hemoglobin and male offspring in response to the hormone. Five of the six non-male-producing clones produced neither hemoglobin nor males in response to the hormone. These results provide additional evidence that both physiological processes are regulated by the same signaling pathway. Furthermore, the results indicate that the non-male-producing clones are largely defective in some methyl farnesoate signaling component, downstream from methyl farnesoate synthesis but upstream from the genes regulated by the hormone. A likely candidate for the site of the defect is the methyl farnesoate receptor. As a consequence of this defect, non-male-producing clones have lost their responsiveness to environmental signals that are transduced by this endocrine pathway. This defect in signaling would be likely to enhance population growth in stable environments due to the elimination of males from the population, assuming that other processes critical to population growth are not also compromised by this defect.