The Ly-6 family includes a number of highly homologous, low molecular weight glycophosphatidylinositol-linked proteins expressed on hematopoietic and lymphoid cells. The best characterized family member is Sca-1 (Ly-6A/E), an antigen commonly used for purification of murine pluripotent hematopoietic cells. We sought to characterize the genomic locus surrounding the Sca-1 gene. We identified several overlapping P1 artificial chromosomes containing the Sca-1 gene and mapped one of these to mouse chromosome 15D3.1-3.3, the region previously shown to contain members of the murine Ly-6 gene family. We then mapped this clone and found that the Sca-2 gene lies 35.4 kilobase (kb) downstream of Sca-1 in the opposite transcriptional orientation. This is the first direct demonstration of physical linkage of Ly-6 genes. A novel gene, highly homologous to Sca-1 was identified and localized 13.4 kb downstream of Sca-1. This gene, which we designated Ly-6M, shares several structural features conserved among members of the Ly-6 family. Ly-6M messenger RNA (mRNA) is easily detectable in hematopoietic tissue (bone marrow, spleen, thymus, peritoneal macrophages) as well as kidney and lung. No mRNA expression was detected in heart, stomach, liver, small intestine, brain, or skin. Ly-6M protein is detectable on 10% to 15% of peripheral blood leukocytes, including monocytes and a subpopulation of B220(+) cells. Ly-6M is broadly distributed in the bone marrow, with prominent expression on monocytes and myeloid precursors. The identification and characterization of Ly-6M adds a new member to a complex family of homologous, tightly linked genes that have proven extremely useful reagents for defining populations within the hematopoietic system.