Spermatogonia are adult germline stem cells that can both self-renew and differentiate into spermatocytes. Little is known about factors necessary for spermatogonial differentiation. We identified a novel germ-cell-specific transcription factor that we named Sohlh1 (testis and ovary expressed basic helix-loop-helix (bHLH) transcription factor). In males, Sohlh1 is preferentially expressed in prespermatogonia and Type A spermatogonia. Loss of Sohlh1 causes infertility by disrupting spermatogonial differentiation into spermatocytes. Seven-day-old testes without Sohlh1 still express the testis-specific transcription factors Etv5, Taf4b, Zfp148, and Plzf, overexpress a novel Tohlh2 bHLH transcription factor, but lack LIM homeobox gene Lhx8 and show reduced expression of Ngn3. Sohlh1 represents the first testis-specific bHLH transcription factor that is essential for spermatogonial differentiation.