The adhesion molecule L1 is a member of the immunoglobulin superfamily. L1 is involved in various recognition processes in the CNS and PNS, and binding to L1 can activate signal transduction pathways. Mutations in the human L1 gene are associated with a variable phenotype, including mental retardation and anomalous development of the nervous system, referred to as 'CRASH' (corpus callosum hypoplasia, retardation, adducted thumbs, spastic paraplegia, and hydrocephalus). We generated an animal model of these conditions by gene targetting. Mutant mice were smaller than wild-type and were less sensitive to touch and pain, and their hind-legs appeared weak and uncoordinated. The size of the corticospinal tract was reduced and, depending on genetic background, the lateral ventricles were often enlarged. Non-myelinating Schwann cells formed processes not associated with axons and showed reduced association with axons. In vitro, neurite outgrowth on an L1 substrate and fasciculation were impaired. The mutant mouse described here will help to elucidate the functions of L1 in the nervous system and how these depend on genetic influences.