A novel human alcohol dehydrogenase (ADH) gene called ADH7 has been characterized and determined to encode class IV ADH, an ADH isozyme which is very active as a retinol dehydrogenase. A nearly full-length cDNA for ADH7 was isolated from a human stomach cDNA library, and a 5' genomic clone containing exons 1 and 2 was isolated from a human genomic library. DNA sequence analysis of the cDNA and genomic clones revealed the complete coding region of the gene and the deduced full-length amino acid sequence of human class IV ADH composed of 373 amino acids following the initiator methionine. The class IV identity of the sequence was confirmed by agreement with previously determined sequences for several human stomach class IV ADH peptides. Alignment of the full-length predicted amino acid sequence of human class IV ADH with the full-length sequences of the other four known human ADH classes revealed sequence identities of 69% (class I), 59% (class II), 61% (class III), and 60% (class V). The higher sequence identity shared with human class I ADH suggests that the genes for ADH classes I and IV may have diverged from a common ancestor after the separation of the other classes, and may still share common physiological functions. Discussed is the possibility that one of these functions is retinol oxidation for the synthesis of retinoic acid, a hormone important for cellular differentiation.