A segregating population with 410 F2 individuals from the cross MERCIA (Rht-B1a) × Dwarf 123 was made to identify a new major dwarfing gene carrying by novel wheat germplasm Dwarf 123. Combination of bulk segerant analysis method was used. A total of 145 SSR markers were tested for polymorphisms among parental lines and DNA bulks of F2 population. Out of 145 primer pairs only three markers revealed corresponding polymorphism among parental lines and F2 DNA bulks. The marker Barc20 was close to the dwarfing gene with a genetic distance of 1.8 cM, and markers Gwm513 and Gwm495 were linked to the gene with genetic distance of 6.7 and 13 cM, respectively. Linkage analysis mapped the dwarfing gene to the long arm of chromosome 4B with the order of Barc20-dwarfing gene-Gwm513-Gwm495. The Comparision between the new gene and the known Rht-B1 alleles showed that dwarfing gene Rht-Ai123 was different from the others. The identification of the new dwarfing gene and its linked markers will greatly facilitate its utilization in wheat high yield breeding for reducing plant height.