The murine genome contains multiple genes with protein domains homologous to the Drosophila paired box, present in certain segmentation genes. At least one of these murine paired box (Pax) genes is associated with a developmental mutation. This report, in conjunction with the accompanying paper, describes a second member of this gene family, Pax2, that is also expressed during embryogenesis. Two overlapping cDNA clones were isolated and sequenced. At least two forms of the Pax2 protein can be deduced from the cDNA sequence. In addition to the highly conserved paired domain, an octapeptide sequence is located downstream. Expression of Pax2 is primarily restricted to the developing embryo in the excretory and central nervous systems. The transient nature of Pax2 expression during kidney organogenesis correlates with polarization and induction of epithelial structures and may indicate an important morphogenetic role for this gene.