WUSCHEL (WUS) is a homeodomain transcription factor produced in cells of the niche/organizing center (OC) of shoot apical meristems. WUS specifies stem cell fate and also restricts its own levels by activating a negative regulator, CLAVATA3 (CLV3), in adjacent cells of the central zone (CZ). Here we show that the WUS protein, after being synthesized in cells of the OC, migrates into the CZ, where it activates CLV3 transcription by binding to its promoter elements. Using a computational model, we show that maintenance of the WUS gradient is essential to regulate stem cell number. Migration of a stem cell-inducing transcription factor into adjacent cells to activate a negative regulator, thereby restricting its own accumulation, is a theme that is unique to plant stem cell niches.