Parrot feathers contain red, orange, and yellow polyene pigments called psittacofulvins. Budgerigars are parrots that have been extensively bred for plumage traits during the last century, but the underlying genes are unknown. Here we use genome-wide association mapping and gene-expression analysis to map the Mendelian blue locus, which abolishes yellow pigmentation in the budgerigar. We find that the blue trait maps to a single amino acid substitution (R644W) in an uncharacterized polyketide synthase (MuPKS). When we expressed MuPKS heterologously in yeast, yellow pigments accumulated. Mass spectrometry confirmed that these yellow pigments match those found in feathers. The R644W substitution abolished MuPKS activity. Furthermore, gene-expression data from feathers of different bird species suggest that parrots acquired their colors through regulatory changes that drive high expression of MuPKS in feather epithelia. Our data also help formulate biochemical models that may explain natural color variation in parrots. VIDEO ABSTRACT.