Chromosome walking in the major histocompatibility complex (MHC) class III region has resulted in the isolation of 541 kb of genomic DNA in two sets of overlapping cosmid clones. These two sets encompass the 340 kb separating the C2 and tumour necrosis factor (TNF) alpha and beta genes, except for a 22 kb gap 108 kb centromeric to the TNF alpha gene. The genomic DNA inserts have been characterized for the presence of clusters of restriction sites with CpG dinucleotides in their recognition sequence. In conjunction with pulsed field gel electrophoresis the exact sites which cleave in chromosomal DNA have been established and this has suggested the presence of a number of HTF-islands. Genomic probes flanking the HTF-islands have been hybridized to Northern blots of RNA from a number of cell lines. Transcripts ranging in size from 0.6 to 6 kb corresponding to the products of 12 novel, single copy genes have been identified. In addition the human equivalent of the murine B144 gene was mapped approximately 10 kb centromeric of the TNF alpha gene. The location of so many new genes in this region raises the question as to whether they play any role in the observed HLA associations with an individual's susceptibility to develop autoimmune disease.