Signaling pathways that promote cell division are tightly regulated to prevent developmental anomalies or tumor formation. Transcription factors (TFs) and coregulators are important modulators of signaling pathway activity, as they regulate downstream target gene transcription. In C. elegans, several subunits in the Mediator coregulator complex activate or repress vulva development, which is initiated by Epidermal Growth Factor Receptor (EGFR) signaling. However, the mechanisms by which Mediator can both activate and repress vulva development remain poorly defined. Here, we show that Mediator's dissociable Cyclin Dependent Kinase 8 (CDK-8) Module (CKM), consisting of
cdk-8,
cic-1/Cyclin C,
dpy-22, and
let-19, controls a balance between repression and activation of EGFR signaling-induced transcription. We find that the CKM inhibits vulva formation by repressing EGFR signaling, as CKM mutants ectopically induce the EGFR signaling-driven vulva precursor cell (VPC) fate. This role is cell autonomous, as ectopic vulvae in
cdk-8 mutants are suppressed by VPC-specific (but not hypodermal) expression of a wildtype
cdk-8 transgene. In line with this,
cdk-8 acts genetically downstream of
let-23/EGFR, which acts in VPCs. Mechanistically, the CKM represses EGFR signaling in two ways: First, the CKM promotes transcriptional repression by the LIN-1 Ets-family TF, a repressor of EGFR target genes, as loss of
cdk-8 or
let-19 enhances ectopic vulva formation in
lin-1 reduction-of-function mutants. In line with this, CDK-8 physically binds to LIN-1 in a CDK-8 kinase-dependent manner. Together, these data indicate that CDK-8 is a LIN-1 corepressor. Second, the CKM inhibits transcriptional activation by other Mediator subunits. Unexpectedly, vulva formation in CKM mutants is independent of the Mediator subunit
sur-2, which is required for vulva development in wildtype worms. Instead, vulva formation in CKM mutants requires the Mediator subunits
mdt-15, -27 and -29. Similarly, multiple genes that are upregulated in CKM mutants require
mdt-15. Together, these data suggest that the CKM inhibits MDT-15, -27 and -29 activation of EGFR signaling target genes; we are now investigating this hypothesis using EGFR signaling target gene reporters in VPCs. In sum, the CKM fine-tunes EGFR signaling-induced transcription by corepressing the LIN-1 TF and by inhibiting Mediator coactivator function. Thus, the dissociable CKM may define a molecular switch that controls transcriptional repression vs. activation in a critical cell signaling pathway.