The abnormalities seen in Turner syndrome (monosomy X) presumably result from haploinsufficiency of certain genes on the X chromosome. Gene dosage considerations lead to the prediction that the culpable genes escape X inactivation and have functional homologs on the Y chromosome. Among the genes with these characteristics are those residing in the pseudoautosomal regions (PAR) of the sex chromosomes. A pseudoautosomal location for a dosage-sensitive locus involved in stature has been suggested based on the analyses of patients with deletions of a specific segment of the short arm PAR; hemizygosity for this putative locus probably also contributes to the short stature in Turner individuals. We have isolated a gene from the critical deleted region that encodes a novel homeodomain-containing transcription factor and is expressed at highest levels in osteogenic cells. We have named the gene PHOG, for pseudoautosomal homeobox-containing osteogenic gene. Its deletion in patients with short stature, the predicted altered dosage in 45,X individuals, along with the nature of the encoded protein and its expression pattern, make PHOG an attractive candidate for involvement in the short stature of Turner syndrome. We have also found that the mouse homolog of PHOG is autosomal, which may help to explain the lack of a growth abnormality in mice with monosomy X.