RNA editing modifies cytidines (C) to uridines (U) at specific sites in the transcripts of mitochondria and plastids, altering the amino acid specified by the DNA sequence. Here we report the identification of a critical editing factor of mitochondrial nad7 transcript via molecular characterization of a small kernel 1 (smk1) mutant in Zea mays (maize). Mutations in Smk1 arrest both the embryo and endosperm development. Cloning of Smk1 indicates that it encodes an E-subclass pentatricopeptide repeat (PPR) protein that is targeted to mitochondria. Loss of SMK1 function abolishes the C → U editing at the nad7-836 site, leading to the retention of a proline codon that is edited to encode leucine in the wild type. The smk1 mutant showed dramatically reduced complex–I assembly and NADH dehydrogenase activity, and abnormal biogenesis of the mitochondria. Analysis of the ortholog in Oryza sativa (rice) reveals that rice SMK1 has a conserved function in C → U editing of the mitochondrial nad7-836 site. T-DNA knock-out mutants showed abnormal embryo and endosperm development, resulting in embryo or seedling lethality. The leucine at NAD7-279 is highly conserved from bacteria to flowering plants, and analysis of genome sequences from many plants revealed a molecular coevolution between the requirement for C → U editing at this site and the existence of an SMK1 homolog. These results demonstrate that Smk1 encodes a PPR-E protein that is required for nad7-836 editing, and this editing is critical to NAD7 function in complex-I assembly in mitochondria, and hence to embryo and endosperm development in maize and rice.