The plant-specific LATERAL ORGAN BOUNDARIES DOMAIN (LBD) genes are important regulators of growth and development. Here, a chrysanthemum class I LBD transcription factor gene, designated CmLBD1, was isolated and its function verified. CmLBD1 was transcribed in both the root and stem, but not in the leaf. The gene responded to auxin and was shown to participate in the process of adventitious root primordium formation. Its heterologous expression in Arabidopsis thaliana increased the number of lateral roots formed. When provided with exogenous auxin, lateral root emergence was promoted. CmLBD1 expression also favored callus formation from A. thaliana root explants in the absence of exogenously supplied phytohormones. In planta, CmLBD1 probably acts as a positive regulator of the response to auxin fluctuations and connects auxin signaling with lateral root formation.