In most eutherian mammals, sex determination is governed by the Y-linked gene Sry, but in African pygmy mice Mus minutoides, Sry action is overridden by a variant X chromosome (X*), yielding X*Y females. We hypothesized that X*Y sex reversal may be underpinned not only by neomorphic X chromosome functionality, but also by a compromised Sry pathway. Here, we show that neither M. minutoides SRY nor its target, the Sox9-TESCO enhancer, had appreciable transcriptional activity in in vitro assays, correlating with sequence degradation compared to Mus musculus counterparts. However, M. minutoides SRY activated its cognate TESCO to a moderate degree, and can clearly engage the male pathway in M. minutoides in the wild, indicating that SRY and TESCO may have co-evolved in M. minutoides to retain function above a threshold level. We suggest that weakening of the SRY/TESCO nexus may have facilitated the rise and spread of a variant X* chromosome carrying female-inducing modifier gene(s).