Molecular genetic studies suggest that FLORICAULA (FLO)/LEAFY (LFY) orthologs function to control compound leaf development in some legume species. However, loss-of-function mutations in the FLO/LFY orthologs result in reduction of leaf complexity to different degrees in Pisum sativum and Lotus japonicus. To further understand the role of FLO/LFY orthologs in compound leaf development in legumes, we studied compound leaf developmental processes and characterized a leaf development mutant, single leaflet1 (sgl1), from the model legume Medicago truncatula. The sgl1 mutants exhibited strong defects in compound leaf development; all adult leaves in sgl1 mutants are simple due to failure in initiating lateral leaflet primordia. In addition, the sgl1 mutants are also defective in floral development, producing inflorescence-like structures. Molecular cloning of SGL1 revealed that it encodes the M. truncatula FLO/LFY ortholog. When properly expressed, LFY rescued both floral and compound leaf defects of sgl1 mutants, indicating that LFY can functionally substitute SGL1 in compound leaf and floral organ development in M. truncatula. We show that SGL1 and LFY differed in their promoter activities. Although the SGL1 genomic sequence completely rescued floral defects of lfy mutants, it failed to alter the simple leaf structure of the Arabidopsis thaliana plants. Collectively, our data strongly suggest that initiation of lateral leaflet primordia required for compound leaf development involves regulatory processes mediated by the SGL1 function in M. truncatula.