Circadian rhythms are generated by well-conserved interlocked transcriptional feedback loops in animals. In Drosophila, the dimeric transcription factor CLOCK/CYCLE (CLK/CYC) promotes period (per), timeless (tim), vrille (vri), and PAR-domain protein 1 (Pdp1) transcription. PER and TIM negatively feed back on CLK/CYC transcriptional activity, whereas VRI and PDP1 negatively and positively regulate Clk transcription, respectively. Here, we show that the alpha isoform of the Drosophila FOS homolog KAYAK (KAY) is required for normal circadian behavior. KAY-alpha downregulation in circadian pacemaker neurons increases period length by 1.5 h. This behavioral phenotype is correlated with decreased expression of several circadian proteins. The strongest effects are on CLK and the neuropeptide PIGMENT DISPERSING FACTOR, which are both under VRI and PDP1 control. Consistently, KAY-alpha can bind to VRI and inhibit its interaction with the Clk promoter. Interestingly, KAY-alpha can also repress CLK activity. Hence, in flies with low KAY-alpha levels, CLK derepression would partially compensate for increased VRI repression, thus attenuating the consequences of KAY-alpha downregulation on CLK targets. We propose that the double role of KAY-alpha in the two transcriptional loops controlling Drosophila circadian behavior brings precision and stability to their oscillations.