The period following seedling emergence is a particularly vulnerable stage in the plant life cycle. In Arabidopsis thaliana, the phytochrome-interacting factor (PIF) subgroup of basic-helix-loop-helix transcription factors has a pivotal role in regulating growth during this early phase, integrating environmental and hormonal signals. We previously showed that SPATULA (SPT), a PIF homolog, regulates seed dormancy. In this article, we establish that unlike PIFs, which mainly promote hypo-cotyl elongation, SPT is a potent regulator of cotyledon expansion. Here, SPT acts in an analogous manner to the gibberellin-dependent DELLAs, REPRESSOR OF GA1-3 and GIBBERELLIC ACID INSENSITIVE, which restrain cotyledon expansion alongside SPT. However, although DELLAs are not required for SPT action, we demonstrate that SPT is subject to negative regulation by DELLAs. Cross-regulation of SPT by DELLAs ensures that SPT protein levels are limited when DELLAs are abundant but rise following DELLA depletion. This regulation provides a means to prevent excessive growth suppression that would result from the dual activity of SPT and DELLAs, yet maintain growth restraint under DELLA-depleted conditions. We present evidence that SPT and DELLAs regulate common gene targets and illustrate that the balance of SPT and DELLA action depends on light quality signals in the natural environment. © 2011 American Society of Plant Biologists.