Familial hypercholesterolemia (FH) is an autosomal dominant disease caused by mutations in the low density lipoprotein (LDL) receptor gene. Here, we characterize an LDL receptor mutation that is associated with a distinct haplotype and that causes FH in the Jewish Sephardic population originating from Safed, a town in northern Israel. The mutation was found in eight FH families originating from this community comprising 10% of heterozygote FH index cases screened in Israel. The mutation was not found in four additional FH heterozygotes whose hypercholesterolemia co-segregated with an identical LDL receptor gene haplotype. A guanine to cytosine substitution results in a missense mutation (asp147 to his) in the fourth repeat of the binding domain encoded by exon 4 of the LDL receptor gene. The mutant receptor protein was synthesized in cultured cells as a 120 kDa precursor form that failed to undergo normal processing to a mature cell surface form. Most of the receptor precursors were degraded in the endoplasmic reticulum. The small number of mutant receptors on the cell surface were unable to bind LDL or beta very low density lipoprotein. The abnormal behavior of the mutant receptor was reproduced by site-directed mutagenesis and expression of the mutant protein in CHO cells. The mutation can be diagnosed by allele-specific oligonucleotide hybridization of polymerase chain reaction amplified DNA from FH patients.