The tie-dyed1 (tdy1) mutant of maize (Zea mays) produces chlorotic, anthocyanin-accumulating regions in leaves due to the hyperaccumulation of carbohydrates. Based on the nonclonal pattern, we propose that the accumulation of sucrose (Suc) or another sugar induces the tdy1 phenotype. The boundaries of regions expressing the tdy1 phenotype frequently occur at lateral veins. This suggests that lateral veins act to limit the expansion of tdy1 phenotypic regions by transporting Suc out of the tissue. Double mutant studies between tdy1 and chloroplast-impaired mutants demonstrate that functional chloroplasts are needed to generate the Suc that induces the tdy1 phenotype. However, we also found that albino cells can express the tdy1 phenotype and overaccumulate Suc imported from neighboring green tissues. To characterize the site and mode of action of Tdy1, we performed a clonal mosaic analysis. In the transverse dimension, we localized the function of Tdy1 to the innermost leaf layer. Additionally, we determined that if this layer lacks Tdy1, Suc can accumulate, move into adjacent genetically wild-type layers, and induce tdy1 phenotypic expression. In the lateral dimension, we observed that a tdy1 phenotypic region did not reach the mosaic sector boundary, suggesting that wild-type Tdy1 acts non-cell autonomously and exerts a short-range compensatory effect on neighboring mutant tissue. A model proposing that Tdy1 functions in the vasculature to sense high concentrations of sugar, up-regulate Suc transport into veins, and promote tissue differentiation and function is discussed.