Pseudoachondroplasia (PSACH) is one of the more common skeletal dysplasias and results from mutations in cartilage oligomeric matrix protein (COMP). Most COMP mutations identified to date cluster in the TSP3 repeat region of COMP and the mutant protein is retained in the rough endoplasmic reticulum (rER) of chondrocytes and may result in increased cell death. In contrast, the pathomolecular mechanism of PSACH resulting from C-terminal domain COMP mutations remain largely unknown. This study describes the generation and analysis of a murine model of mild PSACH resulting from a p.Thr583Met mutation in the C-terminal globular domain (CTD) of COMP. Mutant animals are normal at birth, but grow slower than their wild-type littermates and by 9 weeks of age they have mild short-limb dwarfism. Furthermore, by 16 months of age mutant animals exhibit severe degeneration of articular cartilage, which is consistent with early onset osteoarthritis seen in PSACH patients. In the growth plates of mutant mice the chondrocyte columns are sparser and poorly organized. Mutant COMP is secreted into the extracellular matrix, but its localization is disrupted along with the distribution of several COMP-binding proteins. Although mutant COMP is not retained within the rER there is an unfolded protein/cell stress response and chondrocyte proliferation is significantly reduced, while apoptosis is both increased and spatially dysregulated. Overall, these data suggests a mutation in the CTD of COMP exerts a dominant-negative effect on both intra- and extracellular processes. This ultimately affects the morphology and proliferation of growth plate chondrocytes, eventually leading to chondrodysplasia and reduced long bone growth.