Planar cell polarity (PCP) signaling controls a number of morphogenetic processes including convergent extension during gastrulation and neural tube formation. Defects in this pathway cause neural tube defects (NTD), the most common malformations of the central nervous system. The Looptail ( Lp ) mutant mouse was the first mammalian mutant implicating a PCP gene ( Vangl2 ) in the pathogenesis of NTD. We report on a novel chemically induced mutant allele at Vangl2 called Curly Bob that causes a missense mutation p.Ile268Asn (I268N) in the Vangl2 protein. This mutant segregates in a semi-dominant fashion with heterozygote mice displaying a looped tail appearance, bobbing head, and a circling behavior. Homozygote mutant embryos suffer from a severe form of NTD called craniorachischisis, severe PCP defects in the inner hair cells of the cochlea and posterior cristae, and display a distinct defect in retinal axon guidance. This mutant genetically interacts with the Lp allele ( Vangl2 S464N ) in neural tube development and inner ear hair cell polarity. The Vangl2 I268N protein variant is expressed at very low levels in affected neural and retinal tissues of mutant homozygote embryos. Biochemical studies show that Vangl2 I268N exhibits impaired targeting to the plasma membrane and accumulates in the endoplasmic reticulum. The Vangl2 I268N variant no longer physically interacts with its PCP partner DVL3 and has a reduced protein half-life. This mutant provides an important model for dissecting the role of Vangl2 in the development of the neural tube, establishment of polarity of sensory cells of the auditory and vestibular systems, and retinal axon guidance.