The glass transition, a many-body system undergoes an apparent dynamic arrest with no appearance of long-range order, is one of the most challenging problems in condensed matter physics. Recently attention has been focused on the puzzling two-step transition observed in colloidal suspensions of ellipsoids. It was observed that micro nematic domains appearing with increasing packing density suggesting that such micro domains may be the structure origin of the two-step glass transition. Here we report an experimental study of monolayers of colloidal rods which exhibits a two-step glass transition with no appearance of pseudo-nematic domains. Instead, it was found that parallel and perpendicularly packed rods form local free energy minima in configurational space, separated by an activation barrier. This barrier increases significantly when rotational glass transition is approached, thereby the rotational motion is frozen while the translational one remains diffusive. We propose that the activation barrier for rotation is the key to the two-step glass transition in suspensions of rods. Such an activation barrier between well-defined local configurations holds the key to understanding the two-step glass transition in general.