Different point mutations have been identified in the T3-binding domain of the c-erbA beta thyroid hormone receptor gene that are associated with variant phenotypes of generalized thyroid hormone resistance (GTHR). In most cases of GTHR, heterozygotes are affected; a single mutant allele results in the inhibition of the function of normal thyroid hormone receptors. We report here a novel genetic abnormality, a 3-basepair (bp) deletion in the T3-binding domain of the beta-receptor in a kindred, S, with GTHR. One patient, S1, was the product of a consanguineous union of two heterozygotes and was homozygous for this defect. Heterozygotes from kindred S harbored a CAC deletion at nucleotides 1295-1297, which resulted in the deduced loss of amino acid residue threonine at codon 332, and they displayed elevated free T4 levels and inappropriately normal TSH levels characteristic of other kindreds with GTHR. However, patient S1, who had two mutant alleles, had markedly elevated TSH and free T4 levels and displayed profound abnormalities in brain development and linear growth. A fibroblast c-erbA beta cDNA extending from codon 175 to stop codon 457 was cloned from patient S1, sequenced, and used to create a full-length mutant cDNA. The kindred S mutant receptor was synthesized in vitro and did not bind T3. This mutant receptor did bind with similar avidity as the wild-type human beta-receptor to thyroid hormone response elements of the human TSH beta (-12 to 43 bp) and rat GH (-188 to -160 bp) genes. Kindred S showed the effect in man of heterozygous and homozygous expression of a dominant negative form of c-erbA beta.