We report the cloning, characterization, and targeting of an Sp1-related zinc finger transcription factor gene from the distal arm of mouse chromosome 12. This gene, previously identified in rats and humans and designated sp4, is homologous to the Drosophila buttonhead (btd) gene, which is expressed in the head region of developing flies. Similarly, in situ hybridizations show that sp4 is highly expressed in mouse embryos in the developing central nervous system (CNS). Expression of sp4 is seen as early as Day 9 of development, where transcripts are abundant in the posterior neuropore. Expression in later embryos is detected throughout the CNS as well as in other structures, including the nasal mucosa, the vomeronasal organ, the epithelium of the lung and intestinal tract, the testes, and the developing teeth. Northern blot analysis showed sp4 expression in the adult brain and other tissues. Gene targeting by homologous recombination was used to determine the role of sp4 during mouse development. Two-thirds of homozygous mutants die within the first few days after birth and those that survive are smaller than their wild-type littermates. While fertility of the female mutants appears normal, homozygous mutant males do not breed, despite having histologically intact testes containing mature sperm. sp4/sp4 mutant males fail to copulate, indicating that this gene is required for normal male reproductive behavior.