In the last decade breeders of Romagnola cattle observed an outbreak of a new congenital anomaly. This lethal multi-organ developmental dysplasia is mainly characterized by facial deformities, ascites and hepatic fibrosis. Affected stillborn calves were inbred to a single founder sire suggesting autosomal monogenic recessive inheritance. We localized the causative mutation to a 1.2 Mb interval on BTA 17 by genome-wide association and identical by descent mapping. A solution-based method for targeted DNA capture combined with massively parallel sequencing was used to analyze the entire critical region containing 24 genes. Homozygosity for two non-synonymous coding sequence variants affecting the RNF34 and KDM2B genes was detected by evaluating one affected calf. Here we show that the disease phenotype is associated with a KDM2B missense mutation (c.2503G>A) leading to an amino acid exchange (p.D835N) in an evolutionary strongly conserved domain. In addition, the genetic makeup of three inbred cattle strongly supports the causality of the KDM2B mutation. This report of a naturally-occurring spontaneous mutation of a JmjC domain containing histone demethylase gene provides evidence for their important role in the endo- and mesodermal organ development.