Crown roots are the main components of the fibrous root system in cereal crops and play critical roles in plant adaptation; however, the molecular mechanisms underlying their formation in wheat (Triticum aestivum) have not been fully elucidated. In this study, we identified a wheat basic helix-loop-helix (bHLH) protein, TabHLH123, that interacts with the essential regulator of crown root initiation, MORE ROOT in wheat (TaMOR). TabHLH123 is expressed highly in shoot bases and roots. Ectopic expression of TabHLH123 in rice resulted in more roots compared with the wild type. TabHLH123 regulates the expression of genes controlling crown-root development and auxin metabolism, responses, and transport. In addition, we analysed the nucleotide sequence polymorphisms of TabHLH123s in the wheat genome and identified a superior haplotype, TabHLH123-6B, that is associated with high root dry weight and 1000-grain weight, and short plant height. Our study reveals the role of TabHLH123 in controlling the formation of crown roots and provides beneficial insights for molecular marker-assisted breeding in wheat.