Leaf primordia are generated at the periphery of the shoot apex, developing into flat symmetric organs with adaxial-abaxial polarity, in which the indeterminate state is repressed. Despite the crucial role of the ASYMMETRIC LEAVES1 (AS1)-AS2 nuclear-protein complex in leaf adaxial-abaxial polarity specification, information on mechanisms controlling their downstream genes has remained elusive. We systematically analyzed transcripts by microarray and chromatin immunoprecipitation assays and performed genetic rescue of as1 and as2 phenotypic abnormalities, which identified a new target gene, ETTIN (ETT)/AUXIN RESPONSE FACTOR3 (ARF3), which encodes an abaxial factor acting downstream of the AS1-AS2 complex. While the AS1-AS2 complex represses ETT by direct binding of AS1 to the ETT promoter, it also indirectly activates miR390- and RDR6-dependent post-transcriptional gene silencing to negatively regulate both ETT and ARF4 activities. Furthermore, AS1-AS2 maintains the status of DNA methylation in the ETT coding region. In agreement, filamentous leaves formed in as1 and as2 plants treated with a DNA methylation inhibitor were rescued by loss of ETT and ARF4 activities. We suggest that negative transcriptional, post-transcriptional and epigenetic regulation of the ARFs by AS1-AS2 is important for stabilizing early leaf partitioning into abaxial and adaxial domains.