lin-28 is a conserved regulator of cell fate succession in animals. In Caenorhabditis elegans, it is a component of the heterochronic gene pathway that governs larval developmental timing, while its vertebrate homologs promote pluripotency and control differentiation in diverse tissues. The RNA binding protein encoded by
lin-28 can directly inhibit
let-7 microRNA processing by a novel mechanism that is conserved from worms to humans. We found that C. elegans LIN-28 protein can interact with four distinct
let-7 family pre-microRNAs, but in vivo inhibits the premature accumulation of only
let-7. Surprisingly, however,
lin-28 does not require
let-7 or its relatives for its characteristic promotion of second larval stage cell fates. In other words, we find that the premature accumulation of mature
let-7 does not account for
lin-28's precocious phenotype. To explain
let-7's role in
lin-28 activity, we provide evidence that
lin-28 acts in two steps: first, the
let-7-independent positive regulation of
hbl-1 through its 3'UTR to control L2 stage-specific cell fates; and second, a
let-7-dependent step that controls subsequent fates via repression of
lin-41. Our evidence also indicates that
let-7 functions one stage earlier in C. elegans development than previously thought. Importantly,
lin-28's two-step mechanism resembles that of the heterochronic gene
lin-14, and the overlap of their activities suggests a clockwork mechanism for developmental timing. Furthermore, this model explains the previous observation that mammalian Lin28 has two genetically separable activities. Thus,
lin-28's two-step mechanism may be an essential feature of its evolutionarily conserved role in cell fate succession.