Objective: Familial autosomal dominant frontotemporal dementia with ubiquitin-positive, tau-negative inclusions in the brain linked to 17q21-22 recently has been reported to carry null mutations in the progranulin gene (PGRN). Hereditary dysphasic disinhibition dementia (HDDD) is a frontotemporal dementia with prominent changes in behavior and language deficits. A previous study found significant linkage to chromosome 17 in a HDDD family (HDDD2), but no mutation in the MAPT gene. Longitudinal follow-up has enabled us to identify new cases and to further characterize the dementia in this family. The goals of this study were to develop research criteria to classify the different clinical expressions of dementia observed in this large kindred, to identify the causal mutation in affected individuals and correlate this with phenotypic characteristics in this pedigree, and to assess the neuropathological characteristics using immunohistochemical techniques. Methods: In this study we describe a detailed clinical, pathological and mutation analysis of the HDDD2 kindred. Results: Neuropathologically, HDDD2 represents a familial frontotemporal lobar degeneration with ubiquitin-positive, tau-negative inclusions (FTLD-U). We developed research classification criteria and identified three distinct diagnostic thresholds, which helped localize the disease locus. The chromosomal region with the strongest evidence of linkage lies within the minimum critical region for FTLD-U. Sequencing of each exon of the PGRN gene led to the identification of a novel missense mutation, Ala-9 Asp, within the signal peptide. Interpretation: HDDD2 is an FTLD-U caused by a missense mutation in the PGRN gene that cosegregates with the disease and with the disease haplotype in at-risk individuals. This mutation is the first reported pathogenic missense mutation in the signal peptide of the PGRN gene causing FTLD-U. In light of the previous reports of null mutations and its position in the gene, two possible pathological mechanisms are proposed: (1) the protein may accumulate within the endoplasmic reticulum due to inefficient secretion; and (2) mutant RNA may have a lower expression because of degradation via nonsense-mediated decay.