X chromosome inactivation (XCI) is the mammalian mechanism of dosage compensation that balances X-linked gene expression between the sexes. Early during female development, each cell of the embryo proper independently inactivates one of its two parental X-chromosomes. In mice, the choice of which X chromosome is inactivated is affected by the genotype of a cis-acting locus, the X-chromosome controlling element (Xce). Xce has been localized to a 1.9 Mb interval within the X-inactivation center (Xic), yet its molecular identity and mechanism of action remain unknown. We combined genotype and sequence data for mouse stocks with detailed phenotyping of ten inbred strains and with the development of a statistical model that incorporates phenotyping data from multiple sources to disentangle sources of XCI phenotypic variance in natural female populations on X inactivation. We have reduced the Xce candidate 10-fold to a 176 kb region located approximately 500 kb proximal to Xist. We propose that structural variation in this interval explains the presence of multiple functional Xce alleles in the genus Mus. We have identified a new allele, Xce(e) present in Mus musculus and a possible sixth functional allele in Mus spicilegus. We have also confirmed a parent-of-origin effect on X inactivation choice and provide evidence that maternal inheritance magnifies the skewing associated with strong Xce alleles. Based on the phylogenetic analysis of 155 laboratory strains and wild mice we conclude that Xce(a) is either a derived allele that arose concurrently with the domestication of fancy mice but prior the derivation of most classical inbred strains or a rare allele in the wild. Furthermore, we have found that despite the presence of multiple haplotypes in the wild Mus musculus domesticus has only one functional Xce allele, Xce(b). Lastly, we conclude that each mouse taxa examined has a different functional Xce allele.