The capacity of conventional breeding to simultaneously improve the yield and quality of cotton fiber is limited. The accumulation of the plant hormone indole-3-acetic acid (IAA) in cotton fiber initials prompted us to investigate the effects of genetically engineering increased IAA levels in the ovule epidermis. Targeted expression of the IAA biosynthetic gene iaaM, driven by the promoter of the petunia MADS box gene Floral Binding protein 7 (FBP7), increased IAA levels in the epidermis of cotton ovules at the fiber initiation stage. This substantially increased the number of lint fibers, an effect that was confirmed in a 4-year field trial. The lint percentage of the transgenic cotton, an important component of fiber yield, was consistently higher in our transgenic plants than in nontransgenic controls, resulting in a >15% increase in lint yield. Fiber fineness was also notably improved.