The proximal albino deletions identify several functional regions on mouse Chromosome 7 critical for differentiation of mesoderm (mesd), development of the hypothalamus neuroendocrine lineage (nelg), and function of the liver (hsdr1). Using comparative mapping and genomic sequence analysis, we have identified four novel genes and Il16 in the mesd deletion interval. Two of the novel genes, mesdc1 and mesdc2, are located within the mesd critical region defined by BAC transgenic rescue. We have investigated the fetal role of genes located outside the mesd critical region using BAC transgenic complementation of the mesd early embryonic lethality. Using human radiation hybrid mapping and BAC contig construction, we have identified a conserved region of human chromosome 15 homologous to the mesd, nelg, and hsdr1 functional regions. Three human diseases cosegregate with microsatellite markers used in construction of the human BAC/YAC physical map, including autosomal dominant nocturnal frontal lobe epilepsy (ENFL2; also known as ADNFLE), a syndrome of mental retardation, spasticity, and tapetoretinal degeneration (MRST); and a pyogenic arthritis, pyoderma gangrenosum, and acne syndrome (PAPA).