Legumes establish endosymbiotic associations with nitrogen-fixing rhizobia, which they host inside root nodules. Here, specific physiological and morphological adaptations, such as the production of oxygen-binding leghemoglobin proteins and the formation of an oxygen diffusion barrier in the nodule periphery, are essential to protect the oxygen-labile bacterial nitrogenase enzyme. The molecular basis of the latter process remains elusive as the identification of required genes is limited by the epistatic effect of nodule organogenesis over nodule infection and rhizobia accommodation. We overcame this by exploring the phenotypic diversity of Lotus japonicus accessions that uncouple nodule organogenesis from nodule infection when inoculated with a subcompatible Rhizobium strain. Using comparative transcriptomics, we identified genes with functions associated with oxygen homeostasis and deposition of lipid polyesters on cell walls to be specifically up-regulated in infected compared to noninfected nodules. As hydrophobic modification of cell walls is pivotal for creating diffusion barriers like the root endodermis, we focused on two Fatty acyl-CoA Reductase genes that were specifically activated in the root and/or in the nodule endodermis. Mutant lines in a Fatty acyl-CoA Reductase gene expressed exclusively in the nodule endodermis had decreased deposition of polyesters on this cell layer and increased nodule permeability compared to wild-type plants. Oxygen concentrations were significantly increased in the inner cortex of mutant nodules, which correlated with reduced nitrogenase activity, and impaired shoot growth. These results provide the first genetic evidence for the formation of the nodule oxygen diffusion barrier, a key adaptation enabling nitrogen fixation in legume nodules.