During Drosophila oogenesis, the Oskar (OSK) RNA binding protein (RBP) determines the amount of germ plasm that assembles at the posterior pole of the oocyte. Here, we identify mechanisms that subsequently regulate germ plasm assembly in the early embryo. We show that the Smaug (SMG) RBP is transported into the germ plasm of the early embryo where it accumulates in the germ granules. SMG binds to and represses translation of the osk messenger RNA (mRNA) as well as the bruno 1 (bru1) mRNA, which encodes an RBP that we show promotes germ plasm production. Loss of SMG or mutation of SMG's binding sites in the osk or bru1 mRNA results in excess translation of these transcripts in the germ plasm, accumulation of excess germ plasm, and budding of excess primordial germ cells (PGCs). Therefore, SMG triggers a posttranscriptional regulatory pathway that attenuates the amount of germ plasm in embryos to modulate the number of PGCs.