Maturity-onset diabetes of the young (MODY) is a genetically heterogeneous monogenic disorder characterized by autosomal dominant inheritance, onset usually before 25 yr of age, and abnormal pancreatic beta-cell function. Mutations in the hepatocyte nuclear factor(HNF)-4alpha/MODY1, glucokinase/MODY2, and HNF-1alpha/MODY3 genes can cause this form of diabetes. In contrast to the glucokinase and HNF-1alpha genes, mutations in the HNF-4alpha gene are a relatively uncommon cause of MODY, and our understanding of the MODY1 form of diabetes is based on studies of only a single family, the R-W pedigree. Here we report the identification of a second family with MODY1 and the first in which there has been a detailed characterization of hepatic function. The affected members of this family, Dresden-11, have inherited a nonsense mutation, R154X, in the HNF-4alpha gene, and are predicted to have reduced levels of this transcription factor in the tissues in which it is expressed, including pancreatic islets, liver, kidney, and intestine. Subjects with the R154X mutation exhibited a diminished insulin secretory response to oral glucose. HNF-4alpha plays a central role in tissue-specific regulation of gene expression in the liver, including the control of synthesis of proteins involved in cholesterol and lipoprotein metabolism and the coagulation cascade. Subjects with the R154X mutation, however, showed no abnormalities in lipid metabolism or coagulation except for a paradoxical 3.3-fold increase in serum lipoprotein(a) levels, nor was there any evidence of renal dysfunction in these subjects. The results suggest that MODY1 is primarily a disorder of beta-cell function.