New genetic tools that have been developed in the mouse for the study of genetic variation and molecular biology can be applied to the study of craniofacial growth and malformation. D.W. Bailey (Journal of Heredity, 76:107-114, 1985, 77:17-25, 1986) has used congenic and recombinant inbred strains to identify a large number of genes that result in growth variation in local regions of the mandible. The function of "morphogenes" have not been characterized, but they may act as switches that regulate already recognized structural genes. We have studied the cartilage matrix deficiency (cmd/cmd) mutant mouse and found that their chondrocytes fail to synthesize the cartilage-specific proteoglycan at both protein and mRNA levels. In vitro experiments demonstrate biochemical feedback control in the formation of the cartilage extracellular matrix. Abnormalities of cartilage matrix result in facial clefts and in dental malocclusion in mice. A recombinant plasmid containing the type II collagen promoter and enhancer fused to a reporter gene, chloramphenicol acetyl transferase, has been used to produce transgenic mice. These mice reveal that the type II collagen enhancer controls the high level of tissue-specific expression of the gene. The transgenic mice provide a potential test system for study of development and teratogenesis at the gene level.