Signal transduction through the Notch pathway. In the presence of a specific differentiation signal, activation of Notch through ligand binding results in proteolytic cleavage and release of the intracellular domain. Activated intracellular Notch (Notch-IC) and/or CSL proteins translocate to the nucleus, where they activate transcription of E(spl)/HES. The transcription factors encoded by E(spl)/HES in turn suppress transcription of lineage-specific genes, thereby inhibiting cellular differentiation. An equivalent cell, in the absence of Notch activation (right), will respond to the differentiation signal by activating transcription of lineage-specific genes, permitting differentiation along the induced pathway.