In higher plants, the mitochondrial electron transport chain has non-phosphorylating alternative pathways that include the alternative terminal oxidase (AOX). This alternative pathway has been suggested to act as a sink for dissipating excess reducing power, minimizing oxidative stress and possibly optimizing photosynthesis in response to changing conditions. The expression patterns of the AOX genes have been well characterized under different growth conditions, particularly in response to light and temperature stress. Additionally, it has been suggested that mitochondrial electron transport is important for avoiding chloroplast over-reduction and balancing energy partitioning among photosynthesis, photorespiration and respiration. Nonetheless, the role AOX plays in optimizing photosynthetic carbon metabolism is unclear. Therefore, the response of photosynthesis to the disruption of AOX was investigated in the Arabidopsis thaliana T-DNA mutant aox1a (SALK-084897). Gas exchange analysis revealed a lower net CO2 assimilation rate (A) at high CO2 concentrations in the aox1a mutant compared to wild type. This decrease in A was accompanied by a lower maximum electron transport rate and quantum yield of PSII, and higher excitation pressure on PSII and non-photochemical quenching. The aox1a mutant also exhibited a lower estimated rate of ribulose 1,5-bisphosphate regeneration, and the ribulose 1,5-bisphosphate content was lower at high CO2 concentrations, suggesting an ATP limitation of the Calvin-Benson cycle. Additionally, the activity of the malate-oxaloacetate shuttle was lower in the mutant compared to wild type. These results indicate that AOX is important for optimizing rates of photosynthetic CO2 assimilation in response to rising CO2 concentration by balancing the NAD(P)H/ATP ratio and rates of ribulose 1,5-bisphosphate regeneration within the chloroplast.