Plants and animals are obligate aerobes, requiring oxygen for mitochondrial respiration and energy production. In plants, an unanticipated decline in oxygen availability (hypoxia), as caused by roots becoming waterlogged or foliage submergence, triggers changes in gene transcription and messenger RNA translation that promote anaerobic metabolism and thus sustain substrate-level ATP production(1). In contrast to animals(2), oxygen sensing has not been ascribed to a mechanism of gene regulation in response to oxygen deprivation in plants. Here we show that the N-end rule pathway of targeted proteolysis acts as a homeostatic sensor of severe low oxygen levels in Arabidopsis, through its regulation of key hypoxia-response transcription factors. We found that plants lacking components of the N-end rule pathway constitutively express core hypoxia-response genes and are more tolerant of hypoxic stress. We identify the hypoxia-associated ethylene response factor group VII transcription factors of Arabidopsis as substrates of this pathway. Regulation of these proteins by the N-end rule pathway occurs through a characteristic conserved motif at the amino terminus initiating with Met-Cys. Enhanced stability of one of these proteins, HRE2, under low oxygen conditions improves hypoxia survival and reveals a molecular mechanism for oxygen sensing in plants via the evolutionarily conserved N-end rule pathway. SUB1A-1, a major determinant of submergence tolerance in rice(3), was shown not to be a substrate for the N-end rule pathway despite containing the N-terminal motif, indicating that it is uncoupled from N-end rule pathway regulation, and that enhanced stability may relate to the superior tolerance of Sub1 rice varieties to multiple abiotic stresses(4).