We isolated a dehydrin-like (DHN-like) gene fragment, PpDHNA, from the moss Physcomitrella patens by PCR amplification using degenerate primers directed against conserved amino acid segments of DHNs of higher plants. The full-length cDNA was found to encode a 59.2-kDa glycine-rich protein, DHNA, with typical characteristics of DHNs, including the presence of several Y repeats and one conserved K segment. DHNA had a high sequence similarity with a protein from Tortula ruralis, Tr288, which is thought to be involved in cellular dehydration tolerance/repair in this moss. Northern and Western analysis showed that PpDHNA is upregulated upon treatment of plants with abscisic acid, NaCl or mannitol, indicating a similar expression pattern to DHNs from higher plants. To analyze the contribution of DHNA to osmotic stress tolerance, we generated a knockout mutant (dhnA) by disruption of the gene using homologous recombination. Growth and stress response studies of the mutant showed that dhnA was severely impaired in its capacity to resume growth after salt and osmotic-stress treatments. We provide direct genetic evidence in any plant species for a DHN exerting a protective role during cellular dehydration allowing recovery when returned to optimal growth conditions.