Frontotemporal dementia (FTD) is the second most common cause of dementia in people under the age of 65 years. A large proportion of FTD patients (35-50%) have a family history of dementia, consistent with a strong genetic component to the disease. In 1998, mutations in the gene encoding the microtubule-associated protein tau (MAPT) were shown to cause familial FTD with parkinsonism linked to chromosome 17q21 (FTDP-17). The neuropathology of patients with defined MAPT mutations is characterized by cytoplasmic neurofibrillary inclusions composed of hyperphosphorylated tau. However, in multiple FTD families with significant evidence for linkage to the same region on chromosome 17q21 (D17S1787-D17S806), mutations in MAPT have not been found and the patients consistently lack tau-immunoreactive inclusion pathology. In contrast, these patients have ubiquitin (ub)-immunoreactive neuronal cytoplasmic inclusions and characteristic lentiform ub-immunoreactive neuronal intranuclear inclusions. Here we demonstrate that in these families, FTD is caused by mutations in progranulin (PGRN) that are likely to create null alleles. PGRN is located 1.7 Mb centromeric of MAPT on chromosome 17q21.31 and encodes a 68.5-kDa secreted growth factor involved in the regulation of multiple processes including development, wound repair and inflammation. PGRN has also been strongly linked to tumorigenesis. Moreover, PGRN expression is increased in activated microglia in many neurodegenerative diseases including Creutzfeldt-Jakob disease, motor neuron disease and Alzheimer's disease. Our results identify mutations in PGRN as a cause of neurodegenerative disease and indicate the importance of PGRN function for neuronal survival.