The tra-1 gene is the terminal regulator in the sex determination pathway in C. elegans, directing all aspects of somatic sexual differentiation. Recessive loss-of-function (lf) mutations in tra-1 masculinize XX animals (normally somatically female), while dominant gain-of-function mutations feminize XO animals (normally male). Most tra-1 (lf) mutations can be fitted into a simple allelic series of somatic masculinization, but a small number of lf alleles do not fit into this series. Here we show that three of these mutations are associated with DNA rearrangements 5' to the coding region. One allele is an inversion that may be subject to a position effect. We also report the isolation of a new class of tra-1 alleles that are responsive to mutations in the smg system of RNA surveillance. We show that two of these express RNAs of aberrant size. We suggest that the smg-sensitive mutations may identify a carboxy-terminal domain required for negative regulation of tra-1 activity.