Abstract Spontaneous mutations at the mouse Fused (Fu) locus cause dominant skeletal and neurological defects and recessive lethal embryonic defects including neuroectodermal abnormalities and axial duplications. Here, we describe a new allele at the Fu locus caused by a transgenic insertional mutation, H epsilon 46. Embryos homozygous for the H epsilon 46 insertion die at day 9-10 post coitum and display phenotypic defects similar to those associated with Fu alleles. The H epsilon 46 locus was cloned and shown to contain a 20-kb deletion at the site of transgene insertion with no other detectable rearrangements. Genomic probes from the H epsilon 46 locus were mapped to a genetic locus closely linked to Fu on chromosome 17 and were hybridized to a YAC contig covering the FuKi critical region. Compound heterozygotes between H epsilon 46 and FuKi were inviable and displayed abnormalities at the same stage of embryogenesis as do homozygotes for either of the two mutations, demonstrating that these two recessive lethal mutations belong to the same complementation group. A genomic probe from the wild-type H epsilon 46 locus detected a transcript that is disrupted by the transgenic insertion, representing a candidate for the wild-type allele of Fused.