Differentiation of specialized cell types in multicellular organisms requires orchestrated actions of cell fate determinants. Stomata, valves on the plant epidermis, are formed through a series of differentiation events mediated by three closely related basic-helix-loop-helix proteins: SPEECHLESS (SPCH), MUTE, and FAMA. However, it is not known what mechanism coordinates their actions. Here, we identify two paralogous proteins, SCREAM (SCRM) and SCRM2, which directly interact with and specify the sequential actions of SPCH, MUTE, and FAMA. The gain-of-function mutation in SCRM exhibited constitutive stomatal differentiation in the epidermis. Conversely, successive loss of SCRM and SCRM2 recapitulated the phenotypes of fama, mute, and spch, indicating that SCRM and SCRM2 together determined successive initiation, proliferation, and terminal differentiation of stomatal cell lineages. Our findings identify the core regulatory units of stomatal differentiation and suggest a model strikingly similar to cell-type differentiation in animals. Surprisingly, map-based cloning revealed that SCRM is INDUCER OF CBF EXPRESSION1, a master regulator of freezing tolerance, thus implicating a potential link between the transcriptional regulation of environmental adaptation and development in plants.