Regenerative ability often declines as animals mature past embryonic and juvenile stages, suggesting that regeneration requires redirection of growth pathways that promote developmental growth. Intriguingly, the Drosophila larval epithelia require the hormone ecdysone (Ec) for growth but require a drop in circulating Ec levels to regenerate. Examining Ec dynamics more closely, we find that transcriptional activity of the Ec-receptor (EcR) drops in uninjured regions of wing discs, but simultaneously rises in cells around the injury-induced blastema. In parallel, blastema depletion of genes encoding Ec biosynthesis enzymes blocks EcR activity and impairs regeneration but has no effect on uninjured wings. We find that local Ec/EcR signaling is required for injury-induced pupariation delay following injury and that key regeneration regulators upd3 and Ets21c respond to Ec levels. Collectively, these data indicate that injury induces a local source of Ec within the wing blastema that sustains a transcriptional signature necessary for developmental delay and tissue repair.