The presence of valine-154 instead of glycine in the constant region of lambda1 causes a severe λ1 B cell defect in SJL and λ1-valine knock-in mice with a compensatory increase in λ2,3 B cells. The defect is due to low signaling by the λ1-valine BCR. λ1-Valine B cells deficient in the SHP-1 phosphatase survive better than λ2,3 B cells in these mice, or λ1 B cells in lambda1 wildtype mice. Low signaling is apparently due to misfolding of the λ1-valine light chain as demonstrated by the absence of a regular beta-sheet structure determined by circular dichroism, the sedimentation of the light chain in solution, and the association of valine–valine constant regions in a yeast two-hybrid assay. λ1-Valine B cells that survive apparently have a higher BCR signal, presumably because of their specific λ1-heavy chain combination or having encountered a high-affiniy antigen. λ1-Valine mice have increased B1 cells which were shown by others to have a higher signaling potential. Valine mice crossed with non-conventional γ2b transgenic mice, in which B cell development is accelerated and in which B1 cells and high signaling cells are greatly reduced, have essentially no, λ2,3 B cells, but increased numbers of λ1-valine B cells. This supports the conclusion that the major defect in λ1-valine mice is the inability of valine-preB cells to produce a threshold signal for B cell development. The reduction of λ2,3 B cells in valine mice with a γ2b transgene shows that the majority of their compensatory increase is almost entirely of the B1 cell type.