Stem cells are defined by their ability to self-renew and produce daughter cells that proliferate and mature. These maturing cells transition from a proliferative state to a terminal state through the process of differentiation. In the Arabidopsis thaliana root the transcription factors SCARECROW and SHORTROOT regulate specification of the bipotent stem cell that gives rise to cortical and endodermal progenitors. Subsequent progenitor proliferation and differentiation generate mature endodermis, marked by the Casparian strip, a cell-wall modification that prevents ion diffusion into and out of the vasculature. We identified a transcription factor, MYB DOMAIN PROTEIN 36 (MYB36), that regulates the transition from proliferation to differentiation in the endodermis. We show that SCARECROW directly activates MYB36 expression, and that MYB36 likely acts in a feed-forward loop to regulate essential Casparian strip formation genes. We show that myb36 mutants have delayed and defective barrier formation as well as extra divisions in the meristem. Our results demonstrate that MYB36 is a critical positive regulator of differentiation and negative regulator of cell proliferation.