Mutations in the human tumor suppressor gene, Patched-1, are associated with nevoid basal cell carcinoma syndrome characterized by developmental abnormalities and tumorigenesis, such as basal cell carcinoma and medulloblastoma. During the investigation of complex alternative splicing in Patched-1, we identified an alternative exon, exon 12b, located between exon 12 and 13, both in humans and in mice. Since exon 12b has an in-frame stop codon, the mRNA isoform containing this exon (Patched12b) encodes a truncated patched-1 protein. RT-PCR and whole mount in situ hybridization revealed that mouse exon 12b was expressed in the brain and heart, particularly in the cerebellum, in both adults and embryos. We next performed a functional analysis of Patched12b using a GLI-responsive luciferase reporter. Luciferase activity was suppressed when transfected with a plasmid encoding Patched-1, but not with a plasmid for Patched12b. The suppressive activity of Patched-1 was relieved when cotransfected with a plasmid for Patched12b. This implies that the Patched12b protein has a dominant negative effect on Patched-1. Interestingly, Patched12b was found to be expressed in some of the medulloblastoma tissues and cell lines, indicating an important role in the pathogenesis of medulloblastoma as well as brain development.