Domesticated dogs show unparalleled diversity in body size across breeds, but within breeds variation is limited by selective breeding. Many heritable diseases of dogs are found among breeds of similar sizes, suggesting that as in humans, alleles governing growth have pleiotropic effects. Here, we conducted independent genome-wide association studies in the small Shetland Sheepdog breed and discovered a locus on chromosome 9 that is associated with a dental abnormality called maxillary canine-tooth mesioversion (MCM) (P = 1.53 × 10−7) as well as two body size traits: height (P = 1.67 × 10−5) and weight (P = 1.16 × 10−7). Using whole-genome resequencing data, we identified variants in two proximal genes: FTSJ3, encoding an RNA methyltransferase, and GH1, encoding growth hormone. A substitution in FTSJ3 and a splice donor insertion in GH1 are strongly associated with MCM and reduced body size in Shetland Sheepdogs. We demonstrated in vitro that the GH1 variant leads to exon 3 skipping, predicting a mutant protein known to cause human pituitary dwarfism. Statistical modeling, however, indicates that the FTSJ3 variant is the stronger predictor of MCM and that each derived allele reduces body size by about 1 inch and 5 pounds. In a survey of 224 breeds, both FTSJ3 and GH1 variants are frequent among very small “toy” breeds and absent from larger breeds. Our findings indicate that a chromosome 9 locus harboring tightly linked variants in FTSJ3 and GH1 reduces growth in the Shetland Sheepdog and toy breed dogs and confers risk for MCM through vertical pleiotropy.