CREB-dependent transcription has been implicated in light entrainment of circadian rhythms. Emerging evidence supports that CREB-regulated transcription co-activator 1 (CRTC1) is a key player in this pathway, stimulating light-induced Period1 transcription in mammals. Here we demonstrate that Drosophila CRTC plays pivotal roles in adaptively sustaining circadian clocks. CRTC potentiates timeless (tim) transcription to timely coordinate circadian gene expression with rhythmic locomotor activities. Accordingly, genomic deletion of a CRTC locus leads to a several hours-delay in the circadian phase of clock gene expression and poor locomotor rhythms in constant dark. The tim-specific effects of CRTC are apparent at low temperatures as light induces tim transcription in a CRTC-dependent manner. Consequently, CRTC mutant flies fail to display phase-advance in diurnal locomotor activities in winter-like conditions. Take together our data suggest that circadian function of CRTC homologs have co-evolved with specific clock targets, thus mediating light- and temperature-dependent plasticity in circadian behaviors.