A retained permanent mandibular first molar caused arrested development and a defect of the alveolar bone in a 16-year-old girl. Extraction of the ankylosed tooth was immediately followed by autotransplantation of the developing maxillary third molar. At the 3-year follow-up examination the interproximal bone level at the autotransplanted molar was equal to that of the neighboring teeth. Cone beam computed tomography showed bone at the labial aspect of the transplant. The eruption of the autotransplanted tooth stimulated vertical alveolar bone development and repaired the bone defect. Additionally, there was closure of the posterior open bite that was initially present at the ankylosed molar site.