Serpentine receptors such as smoothened and frizzled play important roles in cell fate determination during animal development. In Dictyostelium discoideum, four serpentine cyclic AMP (cAMP) receptors (cARs) regulate expression of multiple classes of developmental genes. To understand their function, it is essential to know whether each cAR is coupled to a specific gene regulatory pathway or whether specificity results from the different developmental regulation of individual cARs. To distinguish between these possibilities, we measured gene induction in car1 car3 double mutant cell lines that express equal levels of either cAR1, cAR2, or cAR3 under a constitutive promoter. We found that all cARs efficiently mediate both aggregative gene induction by cAMP pulses and induction of postaggregative and prespore genes by persistent cAMP stimulation. Two exceptions to this functional promiscuity were observed. (i) Only cAR1 can mediate adenosine inhibition of cAMP-induced prespore gene expression, a phenomenon that was found earlier in wild-type cells. cAR1's mediation of adenosine inhibition suggests that cAR1 normally mediates prespore gene induction. (ii) Only cAR2 allows entry into the prestalk pathway. Prestalk gene expression is induced by differentiation-inducing factor (DIF) but only after cells have been prestimulated with cAMP. We found that DIF-induced prestalk gene expression is 10 times higher in constitutive cAR2 expressors than in constitutive cAR1 or cAR3 expressors (which still have endogenous cAR2), suggesting that cAR2 mediates induction of DIF competence. Since in wild-type slugs cAR2 is expressed only in anterior cells, this could explain the so far puzzling observations that prestalk cells differentiate at the anterior region but that DIF levels are actually higher at the posterior region. After the initial induction of DIF competence, cAMP becomes a repressor of prestalk gene expression. This function can again be mediated by cAR1, cAR2, and cAR3.