Using standard banding techniques, a within-arm intrachromosomal insertion can be mistakenly interpreted as a paracentric inversion. The need to correctly distinguish between these two types of chromosome rearrangements is emphasized by their different reproductive risks. For carriers of an intrachromosomal insertion, the empiric risk of having a liveborn child with a recombinant chromosome leading to a genetic imbalance is at least 15%, whereas the risk for a carrier of a paracentric inversion having a liveborn child with a recombinant chromosome leading to a genetic imbalance is thought to be practically negligible. We report a unique observation in which a paracentric inversion in the short arm of chromosome 5, 46,XX,inv(5)(p13.3p15.3), was identified in a women who had a daughter with an apparently terminal deletion in the distal short arm of chromosome 5, 46,XX,del(5)(p14.3), and the clinical diagnosis of cri-du-chat syndrome. We further characterized the rearrangement, and fluorescence in situ hybridization (FISH) and microsatellite analyses confirmed the paracentric inversion in the mother and showed the deletion in the daughter was maternal in origin. Therefore, this represents a case in which a confirmed paracentric inversion likely resulted in a viable terminal deletion. We propose a mechanism involving dicentric chromosome formation with subsequent breakage and telomere healing during meiosis. This illustrates a new genomic mechanism of chromosome rearrangement leading to cri-du-chat syndrome and should provide significant information for the medical management of patients with other terminal deletion syndromes. © 2006 Wiley-Liss, Inc.