In horses, graying with age is an autosomal dominant trait associated with a high incidence of melanoma and vitiligo-like depigmentation. Here we show that the Gray phenotype is caused by a 4.6-kb duplication in intron 6 of STX17 (syntaxin-17) that constitutes a cis-acting regulatory mutation. Both STX17 and the neighboring NR4A3 gene are overexpressed in melanomas from Gray horses. Gray horses carrying a loss-of-function mutation in ASIP (agouti signaling protein) had a higher incidence of melanoma, implying that increased melanocortin-1 receptor signaling promotes melanoma development in Gray horses. The Gray horse provides a notable example of how humans have cherry-picked mutations with favorable phenotypic effects in domestic animals.