Dysregulation of CDK8 (Cyclin-Dependent Kinase 8) and its regulatory partner CycC (Cyclin C), two subunits of the conserved Mediator (MED) complex, have been linked to diverse human diseases such as cancer. Thus, it is essential to understand the regulatory network modulating the CDK8-CycC complex in both normal development and tumorigenesis. To identify upstream regulators or downstream effectors of CDK8, we performed a dominant modifier genetic screen in Drosophila based on the defects in vein patterning caused by specific depletion or overexpression of CDK8 or CycC in developing wing imaginal discs. We identified 26 genomic loci whose haploinsufficiency can modify these CDK8- or CycC-specific phenotypes. Further analysis of two overlapping deficiency lines and mutant alleles led us to identify genetic interactions between the CDK8-CycC pair and the components of the Decapentaplegic (Dpp, the Drosophila homolog of TGFβ, or Transforming Growth Factor-β) signaling pathway. We observed that CDK8-CycC positively regulates transcription activated by Mad (Mothers against dpp), the primary transcription factor downstream of the Dpp/TGFβ signaling pathway. CDK8 can directly interact with Mad in vitro through the linker region between the DNA-binding MH1 (Mad homology 1) domain and the carboxy terminal MH2 (Mad homology 2) transactivation domain. Besides CDK8 and CycC, further analyses of other subunits of the MED complex have revealed six additional subunits that are required for Mad-dependent transcription in the wing discs: Med12, Med13, Med15, Med23, Med24, and Med31. Furthermore, our analyses confirmed the positive roles of CDK9 and Yorkie in regulating Mad-dependent gene expression in vivo. These results suggest that CDK8 and CycC, together with a few other subunits of the MED complex, may coordinate with other transcription cofactors in regulating Mad-dependent transcription during wing development in Drosophila.