The idea that apically derived auxin inhibits shoot branching by inhibiting the activity of axillary buds was first proposed 70 years ago, but it soon became clear that its mechanism of action was complex and indirect. Recent advances in the study of axillary bud development and of auxin signal transduction are allowing a better understanding of the role of auxin in controlling shoot branching. These studies have identified a new role for auxin early in bud development as well as some of the second messengers involved in mediating the branch-inhibiting effects of auxin.