Ubiquinone (UQ) has been considered as an electron mediator in electron transfer that generates ATP in Rhizobium under both free-living and symbiosis conditions. When mutated, the dmtH gene has a symbiotic phenotype of forming ineffective nodules on Astragalus sinicus. The gene was isolated from a Mesorhizobium huakuii 7653R transposon-inserted mutant library. The DNA sequence and conserved protein domain analyses revealed that dmtH encodes demethylmenaquinone (DMK) methyltransferase, which catalyzes the terminal step of menaquinone (MK) biosynthesis. Comparative analysis indicated that dmtH homologs were present in only a few Rhizobia. Real-time quantitative PCR showed dmtH is a bacteroid-specific gene. The highest expression was seen at 25 days after inoculation of strain 7653R. Gene disruption and complementation tests demonstrated that the dmtH gene was essential for bacteroid development and symbiotic nitrogen fixation ability. MK and UQ were extracted from the wild type strain 7653R and mutant strain HK116. MK-7 was accumulated under microaerobic condition and UQ-10 was accumulated under aerobic condition in M. huakuii 7653R. The predicted function of DmtH protein was confirmed by the measurement of methyltransferase activity in vitro. These results revealed that MK-7 was used as an electron carrier instead of UQ in M. huakuii 7653R bacteroids.