FOXL2 mutations cause gonadal dysgenesis or premature ovarian failure (POF) in women, as well as eyelid/forehead dysmorphology in both sexes (the ‘blepharophimosis–ptosis–epicanthus inversus syndrome’, BPES). Here we report that mice lacking Foxl2 recapitulate relevant features of human BPES: males and females are small and show distinctive craniofacial morphology with upper eyelids absent. Furthermore, in mice as in humans, sterility is confined to females. Features of Foxl2 null animals point toward a new mechanism of POF, with all major somatic cell lineages failing to develop around growing oocytes from the time of primordial follicle formation. Foxl2 disruption thus provides a model for histogenesis and reproductive competence of the ovary.