Strigolactones are a group of plant compounds of diverse but related chemical structures. They have similar bioactivity across a broad range of plant species, act to optimize plant growth and development, and promote soil microbe interactions. Carlactone, a common precursor to strigolactones, is produced by conserved enzymes found in a number of diverse species. Versions of the MORE AXILLARY GROWTH1 (MAX1) cytochrome P450 from rice and Arabidopsis thaliana make specific subsets of strigolactones from carlactone. However, the diversity of natural strigolactones suggests that additional enzymes are involved and remain to be discovered. Here, we use an innovative method that has revealed a missing enzyme involved in strigolactone metabolism. By using a transcriptomics approach involving a range of treatments that modify strigolactone biosynthesis gene expression coupled with reverse genetics, we identified LATERAL BRANCHING OXIDOREDUCTASE (LBO), a gene encoding an oxidoreductase-like enzyme of the 2-oxoglutarate and Fe(II)-dependent dioxygenase superfamily. Arabidopsis lbo mutants exhibited increased shoot branching, but the lbo mutation did not enhance the max mutant phenotype. Grafting indicated that LBO is required for a graft-transmissible signal that, in turn, requires a product of MAX1. Mutant lbo backgrounds showed reduced responses to carlactone, the substrate of MAX1, and methyl carlactonoate (MeCLA), a product downstream of MAX1. Furthermore, lbo mutants contained increased amounts of these compounds, and the LBO protein specifically converts MeCLA to an unidentified strigolactone-like compound. Thus, LBO function may be important in the later steps of strigolactone biosynthesis to inhibit shoot branching in Arabidopsis and other seed plants.