PC4- and SF2-interacting protein 1 (Psip1)-also known as lens epithelium-derived growth factor (Ledgf)-is a chromatin-associated protein that has been implicated in transcriptional regulation, mRNA splicing, and cell survival in vitro, but its biological function in vivo is unknown. We identified an embryonic stem cell clone with disrupted Psip1 in a gene trap screen. The resulting Psip1-betageo fusion protein retains chromatin-binding activity and the PWWP and AT hook domains of the wild-type protein but is missing the highly conserved C terminus. The majority of mice homozygous for the disrupted Psip1 gene died perinatally, but some survived to adulthood and displayed a range of phenotypic abnormalities, including low fertility, an absence of epididymal fat pads, and a tendency to develop blepharitis. However, contrary to expectations, the lens epithelium was normal. The mutant mice also exhibited motor and/or behavioral defects such as hind limb clenching, reduced grip strength, and reduced locomotor activity. Finally, both Psip1(-/-) neonates and surviving adults had craniofacial and skeletal abnormalities. They had brachycephaly, small rib cages, and homeotic skeletal transformations with incomplete penetrance. The latter phenotypes suggest a role for Psip1 in the control of Hox expression and may also explain why PSIP1 (LEDGF) is found as a fusion partner with NUP98 in myeloid leukemias.