Oxidative respiration produces adenosine triphosphate through the mitochondrial electron transport system controlling the energy supply of plant cells. Here we describe a mitochondrial pentatricopeptide repeat (PPR) domain protein, PPR40, which provides a signaling link between mitochondrial electron transport and regulation of stress and hormonal responses in Arabidopsis (Arabidopsis thaliana). Insertion mutations inactivating PPR40 result in semidwarf growth habit and enhanced sensitivity to salt, abscisic acid, and oxidative stress. Genetic complementation by overexpression of PPR40 complementary DNA restores the ppr40 mutant phenotype to wild type. The PPR40 protein is localized in the mitochondria and found in association with Complex III of the electron transport system. In the ppr40-1 mutant the electron transport through Complex III is strongly reduced, whereas Complex IV is functional, indicating that PPR40 is important for the ubiqinol-cytochrome c oxidoreductase activity of Complex III. Enhanced stress sensitivity of the ppr40-1 mutant is accompanied by accumulation of reactive oxygen species, enhanced lipid peroxidation, higher superoxide dismutase activity, and altered activation of several stress-responsive genes including the alternative oxidase AOX1d. These results suggest a close link between regulation of oxidative respiration and environmental adaptation in Arabidopsis.