Cotton fibres are unusually long, single-celled epidermal seed trichomes and a model for plant cell growth, but little is known about the regulation of fibre cell elongation. Here we report that a homeodomain-leucine zipper (HD-ZIP) transcription factor, GhHOX3, controls cotton fibre elongation. GhHOX3 genes are localized to the 12th homoeologous chromosome set of allotetraploid cotton cultivars, associated with quantitative trait loci (QTLs) for fibre length. Silencing of GhHOX3 greatly reduces (>80%) fibre length, whereas its overexpression leads to longer fibre. Combined transcriptomic and biochemical analyses identify target genes of GhHOX3 that also contain the L1-box cis-element, including two cell wall loosening protein genes GhRDL1 and GhEXPA1. GhHOX3 interacts with GhHD1, another homeodomain protein, resulting in enhanced transcriptional activity, and with cotton DELLA, GhSLR1, repressor of the growth hormone gibberellin (GA). GhSLR1 interferes with the GhHOX3–GhHD1 interaction and represses target gene transcription. Our results uncover a novel mechanism whereby a homeodomain protein transduces GA signal to promote fibre cell elongation.