Using dual cultures of arbuscular mycorrhizal (AM) fungi and Medicago truncatula separated by a physical barrier, we demonstrate that hyphae from germinating spores produce a diffusible factor that is perceived by roots in the absence of direct physical contact. This AM factor elicits expression of the Nod factor-inducible gene MtENOD11, visualized using a pMtENOD11-gusA reporter. Transgene induction occurs primarily in the root cortex, with expression stretching from the zone of root hair emergence to the region of mature root hairs. All AM fungi tested (Gigaspora rosea, Gigaspora gigantea, Gigaspora margarita, and Glomus intraradices) elicit a similar response, whereas pathogenic fungi such as Phythophthora medicaginis, Phoma medicaginis var pinodella and Fusarium solani f.sp. phaseoli do not, suggesting that the observed root response is specific to AM fungi. Finally, pMtENOD11-gusA induction in response to the diffusible AM fungal factor is also observed with all three M. truncatula Nod(-)/Myc(-) mutants (dmi1, dmi2, and dmi3), whereas the same mutants are blocked in their response to Nod factor. This positive response of the Nod(-)/Myc(-) mutants to the diffusible AM fungal factor and the different cellular localization of pMtENOD11-gusA expression in response to Nod factor versus AM factor suggest that signal transduction occurs via different pathways and that expression of MtENOD11 is differently regulated by the two diffusible factors.