Thyroid-specific transcription factor PAX8 has an indispensable role in the thyroid gland development, which is evidenced by the facts that PAX8/Pax8 mutations cause congenital hypothyroidism in humans and mice. More than 90% of known PAX8 mutations were located in the paired domain, suggesting the central role of the domain in exerting the molecular function. Structure-function relationships of PAX8, as well as other PAX family transcription factors, have never been investigated in a systematic manner. Here, we conducted the first alanine-scanning mutagenesis study, in which 132 alanine variants located in the paired domain of PAX8 were created and systematically evaluated in vitro. We found that 76 alanine variants (55%) were loss of function (LOF) variants (defined by <30% activity as compared with wildtype PAX8). Importantly, the distribution of LOF variants were skewed, with more frequently observed in the N-subdomain (65% of the alanine variants in the N-subdomain) than in the C-subdomain (45%). Twelve out of 13 alanine variants in residues that have been affected in patients with congenital hypothyroidism were actually LOF, suggesting that the alanine scanning data can be used to evaluate the functional importance of mutated residues. Using our in vitro data, we tested the accuracy of seven computational algorithms for pathogenicity prediction, showing that they are sensitive but not specific to evaluate on the paired domain alanine variants. Collectively, our experiment-based data would help better understanding of the structure-function relationships of the paired domain, and would provide a unique resource for pathogenicity prediction of future PAX8 variants.