The fork-head transcription factors are involved in a variety of physiological processes including development, aging, obesity, and cancer. The fork-head transcription factor FOXN3 has been implicated in cell cycle and transcription regulation at the cellular level. However, the physiological functions of FOXN3 in mammals are not known. To understand the role of the fork-head transcription factor FOXN3 in mammalian development, we have generated a mutant mouse model for the Foxn3 gene. Our analysis shows that the Foxn3 mutation leads to partial embryonic and postnatal lethality, growth retardation, eye formation defects, dental anomalies and craniofacial defects. Foxn3 mutant tissues and cells are also defective in the expression of distinct osteogenic genes. Interestingly, the phenotypes of Foxn3 mutant mice show a striking overlap with the clinical features of human patients with congenital defects and chromosomal aberrations involving the human FOXN3 locus. More than three fourths of human congenital disorders involve craniofacial malformations and a majority of the perturbed genetic components that lead to such disorders are yet to be identified. Our results implicate a role for the FOXN3 gene in the etiology of craniofacial defects in humans.