Cell diversity in multicellular organisms relies on coordination between cell proliferation and the acquisition of cell identity. The equilibrium between these two processes is essential to assure the correct number of determined cells at a given time at a given place. Using genetic approaches and correlative microscopy, we show that Tramtrack-69 (Ttk69, a Broad-complex, Tramtrack and Bric-à-brac - Zinc Finger (BTB-ZF) transcription factor ortholog of the human promyelocytic leukemia zinc finger factor) plays an essential role in controlling this balance. In the Drosophila bristle cell lineage, which produces the external sensory organs composed by a neuron and accessory cells, we show that ttk69 loss-of-function leads to supplementary neural-type cells at the expense of accessory cells. Our data indicate that Ttk69 (1) promotes cell cycle exit of newborn terminal cells by downregulating CycE, the principal cyclin involved in S-phase entry, and (2) regulates cell-fate acquisition and terminal differentiation, by downregulating the expression of hamlet and upregulating that of Suppressor of Hairless, two transcription factors involved in neural-fate acquisition and accessory cell differentiation, respectively. Thus, Ttk69 plays a central role in shaping neural cell lineages by integrating molecular mechanisms that regulate progenitor cell cycle exit and cell-fate commitment.