How do separate sexes originate and evolve? Plants provide many opportunities to address this question as they have diverse mating systems and separate sexes (dioecy) that evolved many times independently. The classic 'two-factor' model for evolution of separate sexes proposes that males and females can evolve from hermaphrodites via the spread of male and female sterility mutations that turn hermaphrodites into females and males, respectively. This widely accepted model was inspired by early genetic work in dioecious white campion (Silene latifolia) that revealed the presence of two sex-determining factors on the Y-chromosome, though the actual genes remained unknown. Here we report identification and functional analysis of the putative sex-determining gene in S. latifolia, corresponding to the gynoecium suppression factor (GSF). We demonstrate that GSF likely corresponds to a Y-linked CLV3-like gene that is specifically expressed in early male flower buds and encodes the protein that suppresses gynoecium development in S. latifolia. Interestingly, GSFY has a dysfunctional X-linked homolog (GSFX) and their synonymous divergence (dS = 17.9%) is consistent with the age of sex chromosomes in this species. We propose that female development in S. latifolia is controlled via the WUSCHEL-CLAVATA feedback loop, with the X-linked WUSCHEL-like and Y-linked CLV3-like genes, respectively. Evolution of dioecy in the S. latifolia ancestor likely involved inclusion of ancestral GSFY into the non-recombining region on the nascent Y-chromosome and GSFX loss of function, which resulted in disbalance of the WUSCHEL-CLAVATA feedback loop between the sexes and ensured gynoecium suppression in males.