Rhizomelic chondrodysplasia punctata (RCDP) is a genetically heterogeneous, autosomal recessive disorder of peroxisomal metabolism that is clinically characterized by symmetrical shortening of the proximal long bones, cataracts, periarticular calcifications, multiple joint contractures, and psychomotor retardation. Most patients with RCDP have mutations in the PEX7 gene encoding peroxin 7, the cytosolic PTS2-receptor protein required for targeting a subset of enzymes to peroxisomes. These enzymes are deficient in cells of patients with RCDP, because of their mislocalization to the cytoplasm. We report the mutational spectrum in the PEX7 gene of 78 patients (including five pairs of sibs) clinically and biochemically diagnosed with RCDP type I. We found 22 different mutations, including 18 novel ones. Furthermore, we show by functional analysis that disease severity correlates with PEX7 allele activity: expression of eight different alleles from patients with severe RCDP failed to restore the targeting defect in RCDP fibroblasts, whereas two alleles found only in patients with mild disease complemented the targeting defect upon overexpression. Surprisingly, one of the mild alleles comprises a duplication of nucleotides 45–52, which is predicted to lead to a frameshift at codon 17 and an absence of functional peroxin 7. The ability of this allele to complement the targeting defect in RCDP cells suggests that frame restoration occurs, resulting in full-length functional peroxin 7, which leads to amelioration of the predicted severe phenotype. This was confirmed in vitro by expression of the eight-nucleotide duplication–containing sequence fused in different reading frames to the coding sequence of firefly luciferase in COS cells.