Rhizobia secrete specific lipo‐chitooligosaccharide signals (LCOs) called Nod factors that are required for infection and nodulation of legumes. In Rhizobium sp. NGR234, the reducing N‐acetyl‐d‐glucosamine of LCOs is substituted at C₆ with 2‐O‐methyl‐l‐fucose which can be acetylated or sulphated. We identified a flavonoid‐inducible locus on the symbiotic plasmid pNGR234a that contains a new nodulation gene, noeEwhich is required for the sulphation of NGR234 Nod factors (NodNGR). noeE was identified by conjugation into the closely related Rhizobium fredii strain USDA257, which produces fucosylated but non‐sulphated Nod factors (NodUSDA). R. fredii transconjugants producing sulphated LCOs acquire the capacity to nodulate Calopogonium caeruleum. Furthermore, mutation of noeE (NGRΔnoeE ) abolishes the production of sulphated LCOs and prevents nodulation of Pachyrhizus tuberosus. The sulphotransferase activity linked to NoeE is specific for fucose. In contrast, the sulphotransferase NodH of Rhizobium meliloti seems to be less specific than NoeE, because its introduction into NGRΔnoeE leads to the production of a mixture of LCOs that are sulphated on C₆ of the reducing terminus and sulphated on the 2‐O‐methylfucose residue. Together, these findings show that noeE is a host‐specificity gene which probably encodes a fucose‐specific sulphotransferase.