Floret fertility determines the number of grains per inflorescence in cereals. During wheat (Triticum sp.) evolution, floret fertility has been increased and current bread wheat (T. aestivum L.) produces three to five grains per spikelet; however, little is known about the genetic basis controlling floret fertility. Here we identify the quantitative trait locus Grain Number Increase 1 (GNI1), encoding a homeodomain leucine zipper class I (HD-Zip I) transcription factor. GNI1 evolved in the Triticeae through gene duplication and functionalization. GNI1was expressed most abundantly in the apical floret primordia at the distal end of the spikelets and in parts of the rachilla, suggesting that it acts to inhibit apical florets/rachilla growth and development. GNI1expression decreased during wheat evolution, and as a consequence, more fertile florets and grains per spikelet are being produced. Genetic analysis revealed that the reduced-function allele of GNI1-A contributes to increase the number of fertile florets per spikelet. The knockdown of GNI1 in transgenic hexaploid wheat improved fertile floret and grain number. Furthermore, wheat plants carrying the impaired allele increased grain yield under field conditions. Our findings illuminate that gene duplication and functionalization generated evolutionary novelty for floret fertility (i.e. reducing floral numbers) while the mutations towards increased grain production were under selection during wheat evolution under domestication.