In C3 plants, photosynthetic efficiency is reduced by photorespiration. A part of CO2 fixed during photosynthesis in chloroplasts is lost from mitochondria during photorespiration by decarboxylation of glycine by glycine decarboxylase (GDC). Thus, the intracellular position of mitochondria in photosynthetic cells is critical to the rate of photorespiratory CO2 loss. We investigated the intracellular position of mitochondria in parenchyma sheath (PS) and mesophyll cells of 10 C3 grasses from 3 subfamilies (Ehrhartoideae, Panicoideae, and Pooideae) by immunostaining for GDC and light and electron microscopic observation. Immunostaining suggested that many mitochondria were located in the inner half of PS cells and on the vacuole side of chloroplasts in mesophyll cells. Organelle quantification showed that 62–75% of PS mitochondria were located in the inner half of cells, and 62–78% of PS chloroplasts were in the outer half. In mesophyll cells, 61–92% of mitochondria were positioned on the vacuole side of chloroplasts and stromules. In PS cells, such location would reduce the loss of photorespiratory CO2 by lengthening the path of CO2 diffusion and allow more efficient fixation of CO2 from intercellular spaces. In mesophyll cells, it would facilitate scavenging by chloroplasts of photorespiratory CO2 released from mitochondria. Our data suggest that the PS cells of C3 grasses have already acquired an initial structure leading to proto-Kranz and further C3–C4 intermediate anatomy. We also found that in the Pooideae, organelle positioning in PS cells on the phloem side resembles that in mesophyll cells.