In most metazoans, early embryonic development is characterized by rapid division cycles which pause before gastrulation at the mid-blastula transition (MBT). These early cleavage divisions are accompanied by cytoskeletal rearrangements which ensure proper nuclear positioning. Yet, the molecular mechanisms controlling nuclear positioning are not fully elucidated. In Drosophila, early embryogenesis unfolds in a multinucleated syncytium, and nuclei rapidly move across the anterior-posterior (AP) axis at cell cycles 4-6 in a process driven by actomyosin contractility and cytoplasmic flows. Previously, shackleton (shkl) mutants were identified in which this axial spreading is impaired. Here, we show that shkl mutants carry mutations in the cullin-5 (cul-5) gene. Live imaging experiments show that Cul-5 is downstream of the cell cycle but required for cortical actomyosin contractility. The nuclear spreading phenotype of cul-5 mutants can be rescued by reducing Src activity genetically, suggesting that a major target of Cul-5 is Src kinase. cul-5 mutants display gradients of nuclear density across the AP axis at the MBT which we exploit to study cell cycle control as a function of the N/C ratio. We found that the N/C ratio is sensed collectively in neighborhoods of about 100μm and such collective sensing is required for a precise MBT in which all the nuclei in the embryo pause their division cycle. Moreover, we found that the response to the N/C ratio is slightly graded along the AP axis. These two features can be linked to the spatiotemporal regulation of Cdk1 activity. Collectively, our results reveal a new pathway controlling nuclear spreading and provide a quantitative dissection of how nuclear cycles respond to the N/C ratio.