We analyzed the association of HLA-DR and -DQ haplotypes and alleles with multiple sclerosis (MS) in 91 patients and 91 controls from Iceland using the relative predispositional effect method. The aim was to establish whether there is heterogeneity in HLA associations with MS, whether there are both predispositional and protective haplotypes, and whether sequence motifs also contribute to MS susceptibility. MS was positively associated with a DR2 haplotype (DRB5*0101-DQA1*0102-DQB1*0602), and empirical logistic analysis indicated that this haplotype is MS-associated because of a primary MS association with the DR2 allele. A DR13 haplotype (DRB1*1302-DQA1*0102-DQB1*0604) was negatively associated with MS, i.e., protective. Study of DR2-negative patients and controls confirmed this negative association and identified a second protective DR haplotype (DRB1*0701-DQA1*0201-DQB1*0201). Within these protective haplotypes in DR2-negative individuals, both DQA1 alleles and one DQB1 allele (*0604) were protective, but neither DR allele was protective, i.e., DQ loci may be more important than DR loci in encoding molecules protective against MS. Predispositional (Phe67) and protective (Ile67) DR beta sequence motifs were present in the total and DR2-negative patient and control groups. Since DQ but not DR alleles appear to be protective, DR beta Ile67 may confer additional protection against MS. Study of family-normal controls confirmed the MS association with the DR2 haplotype, and the transmission-disequilibrium test showed cosegregation and linkage of DR2 alleles and MS in families.