Cell communication in metazoans requires the highly conserved Notch signaling pathway, which is subjected to strict regulation of both activation and silencing. In Drosophila melanogaster, silencing involves the assembly of a repressor complex by Hairless (H) on Notch target gene promoters. We previously found an in-frame internal ribosome entry site in the full length H transcript resulting in two H protein isoforms (Hp120 and Hp150). Hence, H may repress Notch signalling activity in situations where cap-dependent translation is inhibited. Here we demonstrate the in vivo importance of both H isoforms for proper fly development. To this end, we replaced the endogenous H locus by constructs specifically affecting translation of either Hp150 or Hp120 isoforms using genome engineering. Our findings indicate the functional relevance of both H proteins. Based on bristle phenotypes, the predominant isoform Hp150 appears to be of particular importance. In contrast, growth regulation and venation of the wing require the concomitant activity of both isoforms. Finally, the IRES dependent production of Hp120 during mitosis was verified in vivo. Together our data confirm IRES mediated translation of H protein in vivo, supporting strict regulation of Notch in different cellular settings.