During normal development as well as in diseased states such as cancer, extracellular "niches" often provide cues to proximal cells and activate intracellular pathways. Activation of such signaling pathways in turn instructs cellular proliferation and differentiation. In the Caenorhabditis elegans gonad, GLP-1/Notch signaling instructs germ line stem cells to self-renew through mitotic cell division. As germ cells progressively move out of the niche, they differentiate by entering meiosis and eventually form gametes. In this model system, we uncovered an unexpected role for the dynein motor complex in promoting normal differentiation of proliferating germ cells. We demonstrate that dynein light chain 1 (DLC-1) and its partner, dynein heavy chain 1, inhibit the proliferative cell fate, in part through regulation of METT-10, a conserved putative methyltransferase. We show that DLC-1 physically interacts with METT-10 and promotes both its overall levels and nuclear accumulation. Our results add a new dimension to the processes controlled by the dynein motor complex, demonstrating that dynein can act as an antiproliferative factor.