Posterior polymorphous corneal dystrophy (PPCD, also known as PPMD) is a rare disease involving metaplasia and overgrowth of corneal endothelial cells. In patients with PPCD, these cells manifest in an epithelial morphology and gene expression pattern, produce an aberrant basement membrane, and, sometimes, spread over the iris and nearby structures in a way that increases the risk for glaucoma. We previously mapped PPCD to a region (PPCD3) on chromosome 10 containing the gene that encodes the two-handed zinc-finger homeodomain transcription factor TCF8. Here, we report a heterozygous frameshift mutation in TCF8 that segregates with PPCD in the family used to map PPCD3 and four different heterozygous nonsense and frameshift mutations in TCF8 in four other PPCD probands. Family reports of inguinal hernia, hydrocele, and possible bone anomalies in affected individuals suggest that individuals with TCF8 mutations should be examined for nonocular anomalies. We detect transcripts of all three identified PPCD genes (VSX1, COL8A2, and TCF8) in the cornea. We show presence of a complex (core plus secondary) binding site for TCF8 in the promoter of Alport syndrome gene COL4A3, which encodes collagen type IV alpha 3, and we present immunohistochemical evidence of ectopic expression of COL4A3 in corneal endothelium of the proband of the original PPCD3 family. Identification of TCF8 as the PPCD3 gene provides a valuable tool for the study of critical gene regulation events in PPCD pathology and suggests a possible role for TCF8 mutations in altered structure and function of cells lining body cavities other than the anterior chamber of the eye. Thus, this study has identified TCF8 as the gene responsible for approximately half of the cases of PPCD, has implicated TCF8 mutations in developmental abnormalities outside the eye, and has presented the TCF8 regulatory target, COL4A3, as a key, shared molecular component of two different diseases, PPCD and Alport syndrome.