Background: Legumes are unique in their ability to establish symbiotic interaction with rhizobacteria from Rhizobium genus, which provide them with available nitrogen. Nodulation factors (NFs) produced by Rhizobium initiate legume root hair deformation and curling that entrap the bacteria, and allow it to grow inside the plant. In contrast, legumes and nonlegumes activate defense responses when inoculated with pathogenic bacteria. One major defense pathway is mediated by salicylic acid (SA). SA is sensed and transduced to downstream defense components by a redox-regulated protein called NPR1. Methodology/Principal Findings: We used Arabidopsis mutants in SA defense pathway to test the role of NPR1 in symbiotic interactions. Inoculation of Sinorhizobium meliloti or purified NF on Medicago truncatula or nim1/npr1 A. thaliana mutants induced root hair deformation and transcription of early and late nodulins. Application of S. meliloti or NF on M. truncatula or A. thaliana roots also induced a strong oxidative burst that lasted much longer than in plants inoculated with pathogenic or mutualistic bacteria. Transient overexpression of NPR1 in M. truncatula suppressed root hair curling, while inhibition of NPR1 expression by RNAi accelerated curling. Conclusions/Significance: We show that, while NPR1 has a positive effect on pathogen resistance, it has a negative effect on symbiotic interactions, by inhibiting root hair deformation and nodulin expression. Our results also show that basic plant responses to Rhizobium inoculation are conserved in legumes and non-legumes.