Abnormal penile foreskin development in hypospadias is the most frequent genital malformation in male children, which has increased dramatically in recent decades. A number of environmental factors have been shown to be associated with hypospadias development. The current study investigated the role of epigenetics in the etiology of hypospadias and compared mild (distal), moderate (mid shaft), and severe (proximal) hypospadias. Penile foreskin samples were collected from hypospadias and non-hypospadias individuals to identify alterations in DNA methylation associated with hypospadias. Dramatic numbers of differential DNA methylation regions (DMRs) were observed in the mild hypospadias, with reduced numbers in moderate and low numbers in severe hypospadias. Atresia (cell loss) of the principal foreskin fibroblast is suspected to be a component of the disease etiology. A genome-wide (> 95\%) epigenetic analysis was used and the genomic features of the DMRs identified. The DMR associated genes identified a number of novel hypospadias associated genes and pathways, as well as genes and networks known to be involved in hypospadias etiology. Observations demonstrate altered DNA methylation sites in penile foreskin is a component of hypospadias etiology. In addition, a potential role of environmental epigenetics and epigenetic inheritance in hypospadias disease etiology is suggested.