Regulation of the number of cells is critical for development of multicellular organisms. During plant epidermal development, a protodermal cell first makes a fate decision of whether or not to be the meristemoid mother cell (MMC), which undergoes asymmetric cell division forming a meristemoid and its sister cell. The MMC-derived lineage produces all stomatal guard cells and a large proportion of non-guard cells. We demonstrate that a small secretory peptide, EPIDERMAL PATTERING FACTOR 2 (EPF2), is produced by the MMC and its early descendants, and negatively regulates the density of guard and non-guard epidermal cells. Our results suggest that EPF2 inhibits cells from adopting the MMC fate in a non-cell-autonomous manner, thus limiting the number of MMCs. This feedback loop is critical for regulation of epidermal cell density. The amino acid sequence of EPF2 resembles that of EPF1, which is known to control stomatal positioning. Over-expression of EPF1 also inhibits stomatal development, but EPF1 can act only on a later developmental process than EPF2. Overexpression and promoter swapping experiments suggested that the protein functions of EPF1 and EPF2, rather than the expression patterns of the genes, are responsible for the specific functions. Although targets of EPF1 and EPF2 are different, both EPF1 and EPF2 require common putative receptor components TOO MANY MOUTHS (TMM), ERECTA (ER), ERECTA LIKE 1 (ERL1) and ERL2 in order to function.