Cartilage hair hypoplasia (CHH; MIM 250250) is an autosomal recessive disease with diverse clinical manifestations. It is caused by mutations in RMRP gene, the RNA component of the ribonucleoprotein complex RNase MRP. Mutations in RMRP have been found in patients in the core promoter region or in the transcribed region, but the pathogenetic effect of the mutations is unclear. Real-time PCR assays confirmed that both promoter (c.-16_-1 dup and c.-15_+2 dup) and transcribed mutations (c.168G > A and c.218A > G) lower the expression level of RMRP. Experiments with 5'RACE, showed that the reduced transcription in the promoter mutants was accompanied by shifting of the transcription initiation sites to nucleotides 5'-upstream of the authentic site. Low levels of RMRP expression levels with transcript mutations were also seen when constructs encoding the wild-type and mutant genes were transfected into cultured cells. The reduced transcription was correlated with greater instability of mutant RMRP transcripts compared to controls. A comparable reduction was seen when a mouse gene containing the c.70A > G mutation (the major mutation in humans with CHH) was introduced into ES cells in place of one of the wild-type alleles. The low expression level of the c.70A > G Rmrp RNA was confirmed by expression assays into cultured cells, and was again correlated with RNA instability. Our results indicate that a loss of mutant RNA transcripts is a critical feature of pathogenesis.