Epigenetic mechanisms are known to regulate gene expression but no regulators have been characterized in the context of nodule development in legumes. Here, we describe DEMETER (DME) in Medicago truncatula, a gene coding for a demethylase that is required for normal symbiosome differentiation during nodule development. MtDMEis strongly upregulated in indeterminate nodules in the differentiation zone. The role of DMEduring nodule development was analyzed by using an RNA interference approach. This study showed that DMEis essential for the production of functional nitrogen fixing nodules which present improperly differentiated bacteroids. Transcriptome analysis of RNAi plants showed that MtDMEis involved in the expression of 1166 genes correlated with nodule differentiation genes such as NCR genes.Our work thus demonstrates the importance of DNA (de)methylation and epigenetic regulations for indeterminate nodule development.