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Leaf, spike, stem, and root morphologies are key factors that determine crop growth, development, and productivity. Multiple genes that control these morphological traits have been identified in Arabidopsis, rice, maize, and other plant species. However, little is known about the genomic regions and genes associated with morphological traits in wheat. Here, we identified the ethyl methanesulfonate-derived mutant wheat line M133 that displays multiple morphological changes that include upward-curled leaves, paired spikelets, dwarfism, and delayed heading. Using bulked segregant RNA sequencing (BSR-seq) and a high-resolution genetic map, we identified TraesCS1D02G155200 (HB-D2) as a potential candidate gene. HB-D2 encodes a class III homeodomain-leucine zipper (HD-ZIP III) transcription factor, and the mutation was located in the miRNA165/166 complementary site, resulting in a resistant allele designated rHb-D2. The relative expression of rHb2 in the mutant plants was significantly higher (P < 0.01) than in plants homozygous for the WT allele. Independent resistant mutations that disrupt the miRNA165/166 complementary sites in the A- (rHb-A2) and B-genome (rHb-B2) homoeologs showed similar phenotypic alterations, but the relative intensity of the effects was different. Transgenic plants expressing rHb-D2 gene driven by the maize UBIQUITIN (UBI) promoter showed similar phenotypes to the rHb-D2 mutant. These results confirmed that HB-D2 is the causal gene responsible for the mutant phenotypes. Finally, a survey of 1397 wheat accessions showed that the complementary sites for miRNA165/166 in all three HB2 homoeologs are highly conserved. Our results suggest that HB2 plays an important role in regulating growth and development in wheat.