Differentially methylated sequences associated with imprinted genes are proposed to control genomic imprinting. A 2-kb region located 5' to the imprinted mouse H19 gene is hypermethylated on the inactive paternal allele throughout development. To determine whether this differentially methylated domain (DMD) is required for imprinted expression at the endogenous locus, we have generated mice harboring a 1.6-kb targeted deletion of the DMD and assayed for allelic expression of H19 and the linked, oppositely imprinted Igf2 gene. H19 is activated and Igf2 expression is reduced when the DMD deletion is paternally inherited; conversely, upon maternal transmission of the mutation, H19 expression is reduced and Igf2 is activated. Consistent with the DMD's hypothesized role of setting up the methylation imprint, the mutation also perturbs allele-specific methylation of the remaining H19 sequences. In conclusion, these experiments show that the H19 hypermethylated 5' flanking sequences are required to silence paternally derived H19. Additionally, these experiments demonstrate a novel role for the DMD on the maternal chromosome where it is required for the maximal expression of H19 and the silencing of Igf2. Thus, the H19 differentially methylated sequences are required for both H19 and Igf2 imprinting.