PRAS40 has recently been identified as a protein that couples insulin/IGF signaling (IIS) to TORC1 activation in cell culture; however, the physiological function of PRAS40 is not known. In this study, we investigate flies lacking PRAS40. Surprisingly, we find both biochemically and genetically that PRAS40 couples IIS to TORC1 activation in a tissue-specific manner, regulating TORC1 activity in ovaries but not in other tissues of the animal. PRAS40 thereby regulates fertility but not growth of the fly, allowing distinct physiological functions of TORC1 to be uncoupled. We also show that the main function of PRAS40 in vivo is to regulate TORC1 activity, and not to act as a downstream target and effector of TORC1. Finally, this work sheds some light on the question of whether TORC1 activity is coupled to IIS in vivo.