The hypothalamus is a key regulatory unit of the neuroendocrine system and plays an essential role in energy balance and reproduction. Despite its important role, the molecular mechanisms underlying hypothalamic development are not fully understood. Here, we report molecular analyses of a newly identified murine homeobox gene, Bsx/Bsx1a, that is expressed in the developing and postnatal hypothalamus. We demonstrate that BSX1A is a DNA binding protein and a transcriptional activator. Transcriptional reporter assays identified the C-terminal region of BSX1A as an activation domain. We have isolated an alternative splice form of Bsx1a, designated Bsx1b, which retains the N-terminal region but lacks the homeodomain. Analyses of subcellular localization using transfected cell lines revealed that BSX1A and BSX1B localize in the nuclei and cytoplasm, respectively. Immunohistochemical analyses suggested that both BSX1A and BSX1B are expressed in the neonatal hypothalamus. Taking these data together, we propose that alternative RNA splicing is involved in hypothalamic development/function.