Chromosome conformation capture methods have identified subchromosomal structures of higher-order chromatin interactions called topologically associated domains (TADs) that are separated from each other by boundary regions. By subdividing the genome into discrete regulatory units, TADs restrict the contacts that enhancers establish with their target genes. However, the mechanisms that underlie partitioning of the genome into TADs remain poorly understood. Here we show by chromosome conformation capture (capture Hi-C and 4C-seq methods) that genomic duplications in patient cells and genetically modified mice can result in the formation of new chromatin domains (neo-TADs) and that this process determines their molecular pathology. Duplications of non-coding DNA within the mouse Sox9 TAD (intra-TAD) that cause female to male sex reversal in humans, showed increased contact of the duplicated regions within the TAD, but no change in the overall TAD structure. In contrast, overlapping duplications that extended over the next boundary into the neighbouring TAD (inter-TAD), resulted in the formation of a new chromatin domain (neo-TAD) that was isolated from the rest of the genome. As a consequence of this insulation, inter-TAD duplications had no phenotypic effect. However, incorporation of the next flanking gene, Kcnj2, in the neo-TAD resulted in ectopic contacts of Kcnj2 with the duplicated part of the Sox9 regulatory region, consecutive misexpression of Kcnj2, and a limb malformation phenotype. Our findings provide evidence that TADs are genomic regulatory units with a high degree of internal stability that can be sculptured by structural genomic variations. This process is important for the interpretation of copy number variations, as these variations are routinely detected in diagnostic tests for genetic disease and cancer. This finding also has relevance in an evolutionary setting because copy-number differences are thought to have a crucial role in the evolution of genome complexity.