The conserved cellular metabolites nitric oxide (NO) and oleic acid (18:1) are well-known regulators of disease physiologies in diverse organism. We show that NO production in plants is regulated via 18:1. Reduction in 18:1 levels, via a genetic mutation in the 18:1-synthesizing gene SUPPRESSOR OF SA INSENSITIVITY OF npr1-5 (SSI2) or exogenous application of glycerol, induced NO accumulation. Furthermore, both NO application and reduction in 18:1 induced the expression of similar sets of nuclear genes. The altered defense signaling in the ssi2 mutant was partially restored by a mutation in NITRIC OXIDE ASSOCIATED1 (NOA1) and completely restored by double mutations in NOA1 and either of the nitrate reductases. Biochemical studies showed that 18:1 physically bound NOA1, in turn leading to its degradation in a protease-dependent manner. In concurrence, overexpression of NOA1 did not promote NO-derived defense signaling in wild-type plants unless 18:1 levels were lowered. Subcellular localization showed that NOA1 and the 18:1 synthesizing SSI2 proteins were present in close proximity within the nucleoids of chloroplasts. Indeed, pathogen-induced or low-18:1-induced accumulation of NO was primarily detected in the chloroplasts and their nucleoids. Together, these data suggest that 18:1 levels regulate NO synthesis, and, thereby, NO-mediated signaling, by regulating NOA1 levels.