C-TERMINALLY ENCODED PEPTIDEs (CEPs) control root system architecture in a non-cell-autonomous manner. In Medicago truncatula, MtCEP1 affects root development by increasing nodule formation and inhibiting lateral root emergence by unknown pathways. Here, we show that the MtCEP1 peptide-dependent increase in nodulation requires the symbiotic signaling pathway and ETHYLENE INSENSITIVE2 (EIN2)/SICKLE (SKL), but acts independently of SUPER NUMERIC NODULES. MtCEP1-dependent inhibition of lateral root development acts through an EIN2-independent mechanism. MtCEP1 increases nodulation by promoting rhizobial infections, the developmental competency of roots for nodulation, the formation of fused nodules, and an increase in frequency of nodule development that initiates at proto-phloem poles. These phenotypes are similar to those of the ein2/skl mutant and support that MtCEP1 modulates EIN2-dependent symbiotic responses. Accordingly, MtCEP1 counteracts the reduction in nodulation induced by increasing ethylene precursor concentrations, and an ethylene synthesis inhibitor treatment antagonizes MtCEP1 root phenotypes. MtCEP1 also inhibits the development of EIN2-dependent pseudonodule formation. Finally, mutants affecting the COMPACT ROOT ARCHITECTURE2 (CRA2) receptor, which is closely related to the Arabidopsis CEP Receptor1, are unresponsive to MtCEP1 effects on lateral root and nodule formation, suggesting that CRA2 is a CEP peptide receptor mediating both organogenesis programs. In addition, an ethylene inhibitor treatment counteracts the cra2 nodulation phenotype. These results indicate that MtCEP1 and its likely receptor, CRA2, mediate nodulation and lateral root development through different pathways.