Developmental processes in multicellular organisms involve an intricate balance between mechanisms that promote cell division activity and growth, and others that promote cell differentiation. Leaf development in Arabidopsis thaliana is controlled by genes like BLADE ON PETIOLE1 (BOP1), which prevent the development of ectopic meristematic activity that leads to the formation of new organs, and JAGGED (JAG), which control the proximodistal development of the leaf by regulating cell-division activity. We have isolated and characterized the BOP1 gene together with a functionally redundant close homolog that we name BOP2. The BOP genes are members of a gene family containing ankyrin repeats and a BTB/POZ domain, suggesting a role in protein-protein interaction. We show that the BOP genes are expressed in the proximal parts of plant lateral organs where they repress the transcription not only of class 1 knox genes but also of JAG. We also show that the BOP genes are acting together with the flower meristem identity gene LEAFY in the suppression of bract formation. These findings show that the BOP genes are important regulators of the growth and development of lateral organs.