We have replaced the Hox-3.1 coding sequence with the E. coli lacZ gene by means of homologous recombination in embryonic stem cells and thus produced null mutant mice. Homozygous mice were born alive, but most of them died within a few days. In the trunk region of homozygotes, several skeletal segments were transformed into the likeness of more anterior ones, as observed in Drosophila with loss-of-function homeotic mutations. The most obvious transformations were the attachment of the 8th pair of ribs to the sternum and the appearance of a 14th pair of ribs on the 1st lumbar vertebra. The pattern of beta-galactosidase activity was identical in heterozygotes and homozygotes and reflected faithfully the Hox-3.1 expression pattern. Thus, the mutation modified the identity, rather than the position, of embryonic cells that would normally express Hox-3.1.