In the Chapel Hill colony of factor VIII-deficient dogs, abnormal sequence (ch8, for canine hemophilia 8, GenBank no. ) follows exons 1-22 in the factor VIII transcript in place of exons 23-26. The canine hemophilia 8 locus (ch8) sequence was found in a 140-kb normal dog genomic DNA bacterial artificial chromosome (BAC) clone that was completely outside the factor VIII gene, but not in BAC clones containing the factor VIII gene. The BAC clone that contained ch8 also contained a homologue of F8A (factor 8 associated) sequence, which participates in a common inversion that causes severe hemophilia A in humans. Fluorescence in situ hybridization analysis indicated that exons 1-26 normally proceed sequentially from telomere to centromere at Xq28, and ch8 is telomeric to the factor VIII gene. The appearance of an "upstream" genomic sequence element (ch8) at the end of the aberrant factor VIII transcript suggested that an inversion of genomic DNA replaced factor VIII exons 22-26 with ch8. The F8A sequence appeared also in overlapping normal BAC clones containing factor VIII sequence. We hypothesized that homologous recombination between copies of canine F8A inside and outside the factor VIII gene had occurred, as in human hemophilia A. High-resolution fluorescent in situ hybridization on hemophilia A dog DNA revealed a pattern consistent with this inversion mechanism. We also identified a HindIII restriction fragment length polymorphism of F8A fragments that distinguished hemophilia A, carrier, and normal dogs' DNA. The Chapel Hill hemophilia A dog colony therefore replicates the factor VIII gene inversion commonly seen in humans with severe hemophilia A.