The BALB/c inbred mouse is widely used in models of infectious disease, transplantation, and cancer. The differences in the immune responses of BALB/c compared to C57BL/6 mice are especially valuable for the identification of immune regulation genes. One striking immune variance between these mice is in the function of natural killer (NK) cells, and there is strong evidence implicating differential expression of Ly49 genes. In this study, the complete BALB/c Ly49 gene cluster has been sequenced and found to contain six functional genes and two pseudogenes. Compared to C57BL/6 mice, there is a 200 kb region absent in the BALB/c cluster including a complete lack of Ly49h-related genes, which explains the increased susceptibility of BALB/c to cytomegalovirus infection. In addition, there is no BALB/c Ly49d allele, explaining the inability of BALB/c NK cells to kill certain tumor cells. The Ly49 region has now been sequenced in three different inbred mouse strains, and comparisons indicate that the evolution of each haplotype is not straightforward and has involved large-scale deletions/ insertions, gene recombination, and unequal crossing over between divergent haplotypes. This study confirms that relatively small murine class I MHC receptor haplotypes exist, analogous to observations made of human killer cell Ig-like receptor gene haplotypes.