Lateral organs produced by shoot apical and flower meristems exhibit a fundamental abaxial-adaxial asymmetry. We describe three members of the YABBY gene family, FILAMENTOUS FLOWER, YABBY2 and YABBY3, isolated on the basis of homology to CRABS CLAW. Each of these genes is expressed in a polar manner in all lateral organ primordia produced from the apical and flower meristems. The expression of these genes is precisely correlated with abaxial cell fate in mutants in which abaxial cell fates are found ectopically, reduced or eliminated. Ectopic expression of either FILAMENTOUS FLOWER or YABBY3 is sufficient to specify the development of ectopic abaxial tissues in lateral organs. Conversely, loss of polar expression of these two genes results in a loss of polar differentiation of tissues in lateral organs. Taken together, these observations indicate that members of this gene family are responsible for the specification of abaxial cell fate in lateral organs of Arabidopsis. Furthermore, ectopic expression studies suggest that ubiquitous abaxial cell fate and maintenance of a functional apical meristem are incompatible.