A population-wide linkage disequilibrium on bovine chromosome 14 between microsatellite ILSTS039 and DGAT1, a putative quantitative trait locus affecting milk production traits, was found in the Israeli Holstein population. A total of 394 bulls were genotyped for both DGAT1 and ILSTS039, and 1747 cows were genotyped for ILSTS039. The ILSTS039 allele termed "225," and the DGAT1 K allele (substitution of a lysine residue with alanine), were associated with decreased milk production, and increased fat production and fat and protein percent. The number of 225 ILSTS039 and K DGAT1 alleles per individual were the same for 80% of the bulls genotyped. From the effects associated with cows homozygous for the 225 allele, the effect of the quantitative trait locus appears to be approximately codominant. The substitution effect was 0.16% fat. Genotype probabilities for the quantitative gene were determined for the entire Israeli Holstein milk-recorded population, including 507,725 cows and 1442 bulls, using segregation analysis. Overall frequency of the allele that increased fat percent was 8.9% in cows and 15.5% in bulls. The frequency of this allele decreased from 1981 until 1990, from 15 to 5%, and since has increased to 10%. The effects estimated on the population-wide analyses of both cows and bulls were similar to the effect associated with DGAT1 in the daughters of genotyped bulls. Modified animal model evaluations were computed for the entire population with the effect of this gene included in the model. The correlations between the modified and standard animal model evaluations for all traits were > 0.99.