To date, a role for agouti signalling protein (ASIP) in human pigmentation has not been well characterized. It is known that agouti plays a pivotal role in the pigment switch from the dark eumelanin to the light pheomelanin in the mouse. However, because humans do not have an agouti banded hair pattern, its role in human pigmentation has been questioned. We previously identified a single polymorphism in the 3'-untranslated region (UTR) of ASIP that was found at a higher frequency in African-Americans compared with other population groups. To compare allele frequencies between European-Australians and indigenous Australians, the g.8818A --> G polymorphism was genotyped. Significant differences were seen in allele frequencies between these groups (P < 0.0001) with carriage of the G allele highest in Australian Aborigines. In the Caucasian sample set a strong association was observed between the G allele and dark hair colour (P = 0.004) (odds ratio 4.6; 95% CI 1.4-15.27). The functional consequences of this polymorphism are not known but it was postulated that it might result in message instability and premature degradation of the transcript. To test this hypothesis, ASIP mRNA levels were quantified in melanocytes carrying the variant and non-variant alleles. Using quantitative real-time polymerase chain reaction the mean ASIP mRNA ratio of the AA genotype to the AG genotype was 12 (P < 0.05). This study suggests that the 3'-UTR polymorphism results in decreased levels of ASIP and therefore less pheomelanin production.