Sugars modulate many vital metabolic and developmental processes in plants, from seed germination to flowering, senescence and protection against diverse abiotic and biotic stresses. However, the exact mechanisms involved in morphogenesis, developmental signalling and stress tolerance remain largely unknown. Here we report the characterization of a novel Arabidopsis thaliana mutant, sweetie, with drastically altered morphogenesis, and a strongly modified carbohydrate metabolism leading to elevated levels of trehalose, trehalose-6-phosphate and starch. We additionally show that the disruption of SWEETIE causes significant growth and developmental alterations, such as severe dwarfism, lancet-shaped leaves, early senescence and flower sterility. Genes implicated in sugar metabolism, senescence, ethylene biosynthesis and abiotic stress were found to be upregulated in sweetie. Our physiological, biochemical, genetic and molecular data indicate that the mutation in sweetie was nuclear, single and recessive. The effects of metabolizable sugars and osmolytes on sweetie morphogenesis were distinct; in light, sweetie was hypersensitive to sucrose and glucose during vegetative growth and a partial phenotypic reversion took place in the presence of high sorbitol concentrations. However, SWEETIE encodes a protein that is unrelated to any known enzyme involved in sugar metabolism. We suggest that SWEETIE plays an important regulatory function that influences multiple metabolic, hormonal and stress-related pathways, leading to altered gene expression and pronounced changes in the accumulation of sugar, starch and ethylene.