Classical hormone receptors reversibly and non-covalently bind active hormone molecules, which are generated by biosynthetic enzymes, to trigger signal transduction. The α/β hydrolase DWARF14 (D14), which hydrolyses the plant branching hormone strigolactone and interacts with the F-box protein D3/MAX2, is probably involved in strigolactone detection. However, the active form of strigolactone has yet to be identified and it is unclear which protein directly binds the active form of strigolactone, and in which manner, to act as the genuine strigolactone receptor. Here we report the crystal structure of the strigolactone-induced AtD14-D3-ASK1 complex, reveal that Arabidopsis thaliana (At)D14 undergoes an open-to-closed state transition to trigger strigolactone signalling, and demonstrate that strigolactone is hydrolysed into a covalently linked intermediate molecule (CLIM) to initiate a conformational change of AtD14 to facilitate interaction with D3. Notably, analyses of a highly branched Arabidopsis mutant d14-5 show that the AtD14(G158E) mutant maintains enzyme activity to hydrolyse strigolactone, but fails to efficiently interact with D3/MAX2 and loses the ability to act as a receptor that triggers strigolactone signalling in planta. These findings uncover a mechanism underlying the allosteric activation of AtD14 by strigolactone hydrolysis into CLIM, and define AtD14 as a non-canonical hormone receptor with dual functions to generate and sense the active form of strigolactone.