Cell-type diversity in multicellular organisms is created through a series of binary cell fate decisions. Lateral inhibition controlled by Delta-Notch signalling is the core mechanism for the choice of alternative cell types by homogeneous neighbouring cells. Here, we show that cells engineered with a Delta-Notch-dependent lateral inhibition circuit spontaneously bifurcate into Delta-positive and Notch-active cell populations. The synthetic lateral inhibition circuit comprises transcriptional repression of Delta and intracellular feedback of Lunatic fringe (Lfng). The Lfng-feedback subcircuit, even alone, causes the autonomous cell-type bifurcation. Furthermore, the ratio of two cell populations bifurcated by lateral inhibition is reproducible and robust against perturbation. The cell-type ratio is adjustable by the architecture of the lateral inhibition circuit as well as the degree of cell-cell attachment. Thus, the minimum lateral inhibition mechanism between adjacent cells not only serves as a binary cell-type switch of individual cells but also governs the cell-type ratio at the cell-population level.