The diversity of plant architecture is determined by axillary meristems (AMs). AMs are produced from small groups of stem cells in the axils of leaf primordia and generate vegetative branches and reproductive inflorescences. Previous studies identified genes critical for AM development that function in auxin biosynthesis, transport, and signaling. barren stalk1 (ba1), a basic helix-loop-helix transcription factor, acts downstream of auxin to control AM formation. Here, we report the cloning and characterization of barren stalk2 (ba2), a mutant that fails to produce ears and has fewer branches and spikelets in the tassel, indicating that ba2 functions in reproductive AM development. Furthermore, the ba2 mutation suppresses tiller growth in the teosinte branched1 mutant, indicating that ba2 also plays an essential role in vegetative AM development. The ba2 gene encodes a protein that co-localizes and heterodimerizes with BA1 in the nucleus. Characterization of the genetic interaction between ba2 and ba1 demonstrates that ba1 shows a gene dosage effect in ba2 mutants, providing further evidence that BA1 and BA2 act together in the same pathway. Characterization of the molecular and genetic interaction between ba2 and additional genes required for the regulation of ba1 further supports this finding. The ba1 and ba2 genes are orthologs of rice genes, LAX PANICLE1 (LAX1) and LAX2, respectively, hence providing insights into pathways controlling AMs development in grasses.