Cyclophilin A is a conserved peptidyl-prolyl cis-trans isomerase (PPIase) best known as the cellular receptor of the immunosuppressant cyclosporine A. Despite significant effort, evidence of developmental functions of cyclophilin A in non-plant systems has remained obscure. Mutations in a tomato (Solanum lycopersicum) cyclophilin A ortholog, DIAGEOTROPICA (DGT), have been shown to abolish the organogenesis of lateral roots; however, a mechanistic explanation of the phenotype is lacking. Here, we show that the dgt mutant lacks auxin maxima relevant to priming and specification of lateral root founder cells. DGT is expressed in shoot and root, and localizes to both the nucleus and cytoplasm during lateral root organogenesis. Mutation of ENTIRE/IAA9, a member of the auxin-responsive Aux/IAA protein family of transcriptional repressors, partially restores the inability of dgt to initiate lateral root primordia but not the primordia outgrowth. By comparison, grafting of a wild-type scion restores the process of lateral root formation, consistent with participation of a mobile signal. Antibodies do not detect movement of the DGT protein into the dgt rootstock; however, experiments with radiolabeled auxin and an auxin-specific microelectrode demonstrate abnormal auxin fluxes. Functional studies of DGT in heterologous yeast and tobacco-leaf auxin-transport systems demonstrate that DGT negatively regulates PIN-FORMED (PIN) auxin efflux transporters by affecting their plasma membrane localization. Studies in tomato support complex effects of the dgt mutation on PIN expression level, expression domain and plasma membrane localization. Our data demonstrate that DGT regulates auxin transport in lateral root formation.