We have discovered an unusual homeodomain protein, called HOP, which is comprised simply of a homeodomain. HOP is highly expressed in the developing heart where its expression is dependent on the cardiac-restricted homeodomain protein Nkx2.5. HOPdoes not bind DNA and acts as an antagonist of serum response factor (SRF), which regulates the opposing processes of proliferation and myogenesis. Mice homozygous for a HOP null allele segregate into two phenotypic classes characterized by an excess or deficiency of cardiac myocytes. We propose that HOP modulates SRF activity during heart development; its absence results in an imbalance between cardiomyocyte proliferation and differentiation with consequent abnormalities in cardiac morphogenesis.