Stem cells in plants and animals are the source of new tissues and organs. In plants, stem cells are maintained in the central zone (CZ) of multicellular meristems, and large shoot meristems with an increased stem cell population hold promise for enhancing yield. The mobile homeodomain transcription factor WUSCHEL (WUS) is a central regulator of stem cell function in plant shoot meristems. Despite its central importance, the factors that directly modulate WUS protein stability have been a long-standing question. Here, we show that the peptidase DA1 physically interacts with and cleaves the WUS protein, leading to its destabilization. Furthermore, our results reveal that cytokinin signaling represses the level of DA1 protein in the shoot apical meristem, thereby increasing the accumulation of WUS protein. Consistent with these observations, loss of DA1 function results in larger shoot apical meristems with an increased stem cell population and also influences cytokinin-induced enlargement of shoot apical meristem. Collectively, our findings uncover a previously unrecognized mechanism by which the repression of DA1 by cytokinin signaling stabilizes WUS, resulting in the enlarged shoot apical meristems with the increased stem cell number during plant growth and development.