Distal arthrogryposis type 2B (DA2B) is an important genetic disorder in humans. However, the mechanisms governing this disease are not clearly understood. In this study, we generated knock-in mice carrying a DA2B mutation (K175del) in troponin I type 2 (skeletal, fast) (TNNI2), which encodes a fast-twitch skeletal muscle protein. Tnni2K175del mice (referred to as DA2B mice) showed typical DA2B phenotypes, including limb abnormality and small body size. However, the current knowledge concerning TNNI2 could not explain the small body phenotype of DA2B mice. We found that Tnni2 was expressed in the osteoblasts and chondrocytes of long bone growth plates. Expression profile analysis using radii and ulnae demonstrated that Hif3a expression was significantly increased in the Tnni2K175del mice. Chromatin immunoprecipitation assays indicated that both wild-type and mutant tnni2 protein can bind to the Hif3a promoter using mouse primary osteoblasts. Moreover, we showed that the mutant tnni2 protein had a higher capacity to transactivate Hif3a than the wild-type protein. The increased amount of hif3a resulted in impairment of angiogenesis, delay in endochondral ossification, and decrease in chondrocyte differentiation and osteoblast proliferation, suggesting that hif3a counteracted hif1a-induced Vegf expression in DA2B mice. Together, our data indicated that Tnni2K175del mutation led to abnormally increased hif3a and decreased vegf in bone, which explain, at least in part, the small body size of Tnni2K175del mice. Furthermore, our findings revealed a new function of tnni2 in the regulation of bone development, and the study of gain-of-function mutation in Tnni2 in transgenic mice opens a new avenue to understand the pathological mechanism of human DA2B disorder.