Meristems are distinctive regions of plants that have capacity for continuous growth. Their developmental activity generates the majority of plant organs. It is currently unknown how cell division and cell differentiation are orchestrated in meristems, although genetic studies have demonstrated the relevance of a proper balance between the two processes. Root meristems contain a distinct central region of mitotically inactive cells, the quiescent centre, the function of which has remained elusive until now. Here we present laser ablation and genetic data that show that in Arabidopsis thaliana the quiescent centre inhibits differentiation of surrounding cells. Differentiation regulation occurs within the range of a single cell, in a manner strikingly similar to examples in animal development, such as during delamination of Drosophila neuroblasts. Our data indicate that pattern formation in the root meristem is controlled by a balance between short-range signals inhibiting differentiation and signals that reinforce cell fate decisions.