The nature of the faint blue objects seen in deep images of the sky has been a source of great puzzlement. Their high surface density and weak clustering argues against their being either the progenitors or the merging components of the present-day bright galaxies. We interpret the faint blue counts as being due to dwarf elliptical galaxies undergoing their initial starburst at z ~ 1. The starburst epoch is determined by the decline in the UV background, which results in the stably confined photoionized gas in dark haloes of |$M\sim {10}^{9}{M}_{\odot}$| being able to cool and settle in the centre of the haloes and undergo star formation. We find that the evolution of these dwarfs will be strongly influenced by the local intergalactic medium; those in high-pressure environments will be preserved while those in low-pressure regions will fade away. We identify the present-day dwarf ellipticals as the surviving members of the original population and suggest that their spatial distribution as well as their distributions of mean colours and metallicities reflect their environmentally influenced star-formation history. According to our model, M/L for dwarf ellipticals ought to scale as L–l, albeit with a large scatter.