Pea-comb is a dominant mutation in chickens that drastically reduces the size of the comb and wattles. It is an adaptive trait in cold climates as it reduces heat loss and makes the chicken less susceptible to frost lesions. Here we report that Pea-comb is caused by a massive amplification of a duplicated sequence located near evolutionary conserved non-coding sequences in intron 1 of the gene encoding the SOX5 transcription factor. This must be the causative mutation since all other polymorphisms associated with the Pea-comb allele were excluded by genetic analysis. SOX5 controls cell fate and differentiation and is essential for skeletal development, chondrocyte differentiation, and extracellular matrix production. Immunostaining in early embryos demonstrated that Pea-comb is associated with ectopic expression of SOX5 in mesenchymal cells located just beneath the surface ectoderm where the comb and wattles will subsequently develop. The results imply that the duplication expansion interferes with the regulation of SOX5 expression during the differentiation of cells crucial for the development of comb and wattles. The study provides novel insight into the nature of mutations that contribute to phenotypic evolution and is the first description of a spontaneous and fully viable mutation in this developmentally important gene.