Many domestic dog breeds have originated through fixation of discrete mutations by intense artificial selection. As a result of this process, markers in the proximity of genes influencing breed-defining traits will have reduced variation (a selective sweep) and will show divergence in allele frequency. Consequently, low-resolution genomic scans can potentially be used to identify regions containing genes that have a major influence on breed-defining traits. We model the process of breed formation and show that the probability of two or three adjacent marker loci showing a spurious signal of selection within at least one breed (i.e., Type I error or false-positive rate) is low if highly variable and moderately spaced markers are utilized. We also use simulations with selection to demonstrate that even a moderately spaced set of highly polymorphic markers (e.g., one every 0.8 cM) has high power to detect regions targeted by strong artificial selection in dogs. Further, we show that a gene responsible for black coat color in the Large Munsterlander has a 40-Mb region surrounding the gene that is very low in heterozygosity for microsatellite markers. Similarly, we survey 302 microsatellite markers in the Dachshund and find three linked monomorphic microsatellite markers all within a 10-Mb region on chromosome 3. This region contains the FGFR3 gene, which is responsible for achondroplasia in humans, but not in dogs. Consequently, our results suggest that the causative mutation is a gene or regulatory region closely linked to FGFR3.