PAX3 gene is a member of the paired box (PAX) family of transcription factors. Members of the PAX family typically contain a paired box domain and a paired-type homeodomain. These genes play critical roles during fetal development. Mutations in paired box gene 3 are associated with Waardenburg syndrome, craniofacial-deafness-hand syndrome, and alveolar rhabdomyosarcoma. Among solid tumors of the childhood, rhabdomyosarcoma (RMS) is the most common soft tissue sarcoma. RMS are classified in two main categories: embryonal rhabdomyosarcoma (ERMS) and alveolar rhabdomyosarcoma (ARMS). The alveolar histology is associated with a poorer prognosis. ARMS is characterized by two tumor-specific reciprocal translocations t(2;13)(q36;q14.1) and t(1;13) (p36.1;q14.1) detectable in more than 80% of all ARMS. These translocations fuse the FOXO1 locus on 13q14.11 to either PAX3 on chromosome 2 or to PAX7 on chromosome 1. The resulting fusion transcripts encode for the chimeric proteins PAX3-FOXO1 and PAX7-FOXO1 that combine transcriptional domains from the corresponding wild-type proteins and thereby acquire oncogenic activity. The translocations and their fusion genes represent highly specific genetic markers useful in the diagnosis of ARMS.