Hereditary forms of iron-deficiency anemia, including animal models, have taught us much about the normal physiologic control of iron metabolism. However, the discovery of new informative mutants is limited by the natural mutation frequency. To address this limitation, we have developed a screen for heritable abnormalities of red blood cell morphology in mice with single-nucleotide changes induced by the chemical mutagen ethylnitrosourea (ENU). We now describe the first strain, fragile-red, with hypochromic microcytic anemia resulting from a Y228H substitution in the ferrireductase Steap3 (Steap3(Y288H)). Analysis of the Steap3(Y288H) mutant identifies a conserved motif required for targeting Steap3 to internal compartments and highlights how phenotypic screens linked to mutagenesis can identify new functional variants in erythropoiesis and ascribe function to previously unidentified motifs.