Dialkylglycine decarboxylase is a pyridoxal phosphate-dependent enzyme in the aminotransferases class III group of enzymes. The enzyme is unique in terms of catalyzing both decarboxylation and transamination. Although the enzymatic activity is present in some bacteria and fungi, the biological role is unclear. We identified and disrupted the dialkylglycine decarboxylase-encoding gene DGD1 in the wheat blotch fungus Mycosphaerella graminicola by transposon-arrayed gene knockout. The DGD1 gene is highly similar to dialkylglycine decarboxylase from the soil bacterium Burkholderia cepacia. Phylogenetic analysis of various class III aminotransferases showed that dialkylglycine decarboxylases from bacteria and fungi are found in a distinct cluster. Functional analysis revealed that dgd1 disruption mutants display wild-type morphology and pathogenicity to wheat. The dgd1 mutants cannot utilize 2-methylalanine as a sole nitrogen source, as assessed by large-scale nutritional utilization analysis. This is the first description of a mutant phenotype of the fungal dialkylglycine decarboxylase gene.