The recessively inherited developmental disorder, cartilage-hair hypoplasia (CHH) is highly pleiotropic with manifestations including short stature, defective cellular immunity, and predisposition to several cancers. The endoribonuclease RNase MRP consists of an RNA molecule bound to several proteins. It has at least two functions, namely, cleavage of RNA in mitochondrial DNA synthesis and nucleolar cleaving of pre-rRNA. We describe numerous mutations in the untranslated RMRP gene that cosegregate with the CHH phenotype. Insertion mutations immediately upstream of the coding sequence silence transcription while mutations in the transcribed region do not. The association of protein subunits with RNA appears unaltered. We conclude that mutations in RMRP cause CHH by disrupting a function of RNase MRP RNA that affects multiple organ systems.