GPI-anchored proteins (GPI-APs) are essential for plant growth and development; knockout mutations in enzymes responsible for anchor biosynthesis or attachment are gametophyte or embryo lethal. In a genetic screen targeted to identify genes regulating stomata formation, we discovered a missense mutation in the Arabidopsis (Arabidopsis thaliana) homolog of GPI8/PIG-K, a Cys protease that transfers an assembled GPI anchor to proteins. The Arabidopsis genome has a single copy of AtGPI8, and the atgpi8-1 mutation reduces the efficiency of this enzyme, leading to reduced accumulation of GPI-anchored proteins. While the atgpi8-1 mutation strongly disrupts plant growth, it is not lethal. Phenotypic analysis of atgpi8-1 mutants suggests that GPI-APs are important for root and shoot growth, stomata formation, apical dominance, transition to flowering, and male gametophyte viability. In addition, atgpi8-1 mutants accumulate higher levels of callose and have reduced plasmodesmata permeability. Genetic interactions of atgpi8-1 with mutations in ERECTA family (ERf) genes suggest the existence of a GPI-AP in a branch of the ERf signaling pathway that regulates stomata formation. Activation of the ERf signal transduction cascade by constitutively active YODA rescues stomata clustering in atgpi8-1, indicating that a GPI-AP functions upstream of the MAP kinase cascade. TOO MANY MOUTHS (TMM) is a receptor-like protein that is able to form heterodimers with ERfs. Our analysis demonstrates that tmm-1 is epistatic to atgpi8-1, indicating that either TMM is a GPI-AP or there is another GPI-AP regulating stomata development whose function is dependent upon TMM.