Wnt-4, a member of the Wnt family of locally acting secreted growth factors, is the first signaling molecule shown to influence the sex-determination cascade. In mice, a targeted deletion of Wnt-4 causes the masculinization of XX pups. Therefore, WNT-4, the human homologue of murine Wnt-4, is a strong candidate gene for sex-reversal phenotypes in humans. In this article, we show that, in testicular Sertoli and Leydig cells, Wnt-4 up-regulates Dax1, a gene known to antagonize the testis-determining factor, Sry. Furthermore, we elucidate a possible mechanism for human XY sex reversal associated with a 1p31-p35 duplication including WNT-4. Overexpression of WNT-4 leads to up-regulation of DAX1, which results in an XY female phenotype. Thus, WNT-4, a novel sex-determining gene, and DAX1 play a concerted role in both the control of female development and the prevention of testes formation. These observations suggest that mammalian sex determination is sensitive to dosage, at multiple steps in its pathway.