Congenital hypothyroidism (CH) is a relatively frequent and potentially severe disease. It is classically subdivided into: 1) thyroid dysgenesis (TD), a defect in the organogenesis of the gland leading to hypoplastic, ectopic, or absent thyroid gland; or 2) thyroid dyshormonogenesis, a defect in one of the biochemical mechanisms responsible for thyroid hormone synthesis. Most cases of TD are sporadic, although familial occurrences have occasionally been described. Recently, several genes have been implicated in a small proportion of TD, but, in the majority of the cases, the etiology remains unknown. PAX8 is a transcription factor involved in thyroid development. So far, three loss-of-function mutations of PAX8 have been described, two in sporadic cases and one in familial thyroid hypoplasia. Here, we describe a novel mutation of PAX8 causing autosomal dominant transmission of CH with thyroid hypoplasia. The mutation consists of the substitution of a tyrosine for cysteine 57 in the paired domain of PAX8. When tested in cotransfection experiments with a thyroid peroxidasse promoter construct, the mutant allele was unable to exert its normal transactivation effect on transcription. Our results give further evidence that, contrary to the situation in knockout mice, haplo-insufficiency of PAX8 is a cause of CH in humans.