Mice deficient in hepatocyte nuclear factor 1 alpha (HNF-1α) were produced by use of the Cre-loxP recombination system. HNF-1α-null mice are viable but sterile and exhibit a phenotype reminiscent of both Laron-type dwarfism and non-insulin-dependent diabetes mellitus (NIDDM). In contrast to an earlier HNF-1α-null mouse line that had been produced by use of standard gene disruption methodology (M. Pontoglio, J. Barra, M. Hadchouel, A. Doyen, C. Kress, J. P. Bach, C. Babinet, and M. Yaniv, Cell 84:575–585, 1996), these mice exhibited no increased mortality and only minimal renal dysfunction during the first 6 months of development. Both dwarfism and NIDDM are most likely due to the loss of expression of insulin-like growth factor I (IGF-I) and lower levels of insulin, resulting in stunted growth and elevated serum glucose levels, respectively. These results confirm the functional significance of the HNF-1α regulatory elements that had previously been shown to reside in the promoter regions of both the IGF-I and the insulin genes.