Morphogenesis of the Drosophila embryonic trachea involves a stereotyped pattern of epithelial tube branching and fusion. Here, we report unexpected phenotypes resulting from maternal and zygotic (M/Z) loss of the homophilic cell adhesion molecule Echinoid (Ed), as well as the subcellular localization of Ed in the trachea. edM/Z embryos have convoluted trachea reminiscent of septate junction (SJ) and luminal matrix mutants. However, Ed does not localize to SJs, and edM/Z embryos have intact SJs and show normal luminal accumulation of the matrix‐modifying protein Vermiform. Surprisingly, tracheal length is not increased in edM/Z mutants, but a previously undescribed combination of reduced intersegmental spacing and deep epidermal grooves produces a convoluted tracheal phenotype. In addition, edM/Z mutants have unique fusion defects involving supernumerary fusion cells, ectopic fusion events and atypical branch breaks. Tracheal‐specific expression of Ed rescues these fusion defects, indicating that Ed acts in trachea to control fusion cell fate. Developmental Dynamics 239:2509–2519, 2010. © 2010 Wiley‐Liss, Inc.