Knotted1-like homeobox (knox) genes are expressed in specific patterns within shoot meristems and play an important role in meristem maintenance. Misexpression of the knox genes, KNAT1 or KNAT2, in Arabidopsis produces a variety of phenotypes, including lobed leaves and ectopic stipules and meristems in the sinus, the region between lobes. We sought to determine the mechanisms that control knox gene expression in the shoot by examining recessive mutants that share phenotypic characteristics with 35S::KNAT1 plants. Double mutants of serrate (se) with either asymmetric1 (as1) or asymmetric2 (as2) showed lobed leaves, ectopic stipules in the sinuses and defects in the timely elongation of sepals, petals and stamens, similar to 35S::KNAT1 plants. Ectopic stipules and in rare cases, ectopic meristems, were detected in the sinuses on plants that were mutant for pickle and either as1 or as2. KNAT1 and KNAT2 were misexpressed in the leaves and flowers of single as1 and as2 mutants and in the sinuses of leaves of the different double mutants, but not in se or pickle single mutants. These results suggest that AS1 and AS2 promote leaf differentiation through repression of knox expression in leaves, and that SE and PKL globally restrict the competence to respond to genes that promote morphogenesis.