Localized autosomal recessive hypotrichosis (LAH) is a recently defined disorder characterized by fragile, short, sparse hairs on the scalp, trunk, and extremities. Mutations in desmoglein 4 (DSG4), a novel member of the desmosomal cadherin family that is expressed in the hair follicle as well as the suprabasal epidermis, have been found to underlie LAH. Thus far, the allelic series includes a recurrent intragenic deletion identified in affected Pakastani kindreds and a missense mutation detected in an Iraqi family. We report three siblings of Iraqi and Iranian origin with LAH that presented with congenital scalp erosions and monilethrix-like hairs, features that have not been previously described in this disorder. Follicular hyperkeratotic papules and marked pruritus were also prominent clinical findings. Novel compound heterozygous DSG4 mutations, including a splice-site mutation and a missense mutation that disrupts a conserved calcium-binding site in the extracellular (EC)2-EC3 interface, were found to underlie the disease in this family. These observations broaden the phenotypic and genotypic spectrum of LAH, further illustrating the consequences of DSG4 dysfunction on epidermal and hair shaft integrity.