Inappropriately elevated insulin secretion is the hallmark of persistent hyperinsulinemic hypoglycemia of infancy (PHHI), also denoted congenital hyperinsulinism. Causal mutations have been uncovered in genes coding for the β-cell’s ATP-sensitive potassium channel and the metabolic enzymes glucokinase and glutamate dehydrogenase. In addition, one hyperinsulinemic infant was recently found to have a mutation in the gene encoding short-chain 3-hydroxyacyl-CoA dehydrogenase (SCHAD), an enzyme participating in mitochondrial fatty acid oxidation. We have studied a consanguineous family with severe neonatal hypoglycemia due to increased insulin levels and where well-established genetic causes of hyperinsulinism had been eliminated. A genome-wide, microsatellite-based screen for homozygous chromosomal segments was performed. Those regions that were inherited in accordance with the presupposed model were searched for mutations in genes encoding metabolic enzymes. A novel, homozygous deletion mutation was found in the gene coding for the SCHAD enzyme. The mutation affected RNA splicing and was predicted to lead to a protein lacking 30 amino acids. The observations at the molecular level were confirmed by demonstrating greatly reduced SCHAD activity in the patients’ fibroblasts and enhanced levels of 3-hydroxybutyryl-carnitine in their blood plasma. Urine metabolite analysis showed that SCHAD deficiency resulted in specific excretion of 3-hydroxyglutaric acid. By the genetic explanation of our family’s cases of severe hypoglycemia, it is now clear that recessively inherited SCHAD deficiency can result in PHHI. This finding suggests that mitochondrial fatty acid oxidation influences insulin secretion by a hitherto unknown mechanism.