The identification of a pathogenic variant (PV) in one of the mismatch repair (MMR) genes confirms the diagnosis of Lynch syndrome (LS). Hence, the correct classification of MMR gene variants is of utmost importance for appropriate counselling, surveillance, and treatment of LS patients and their families. In 7/200 unrelated Tyrolean-suspected LS patients, we identified the rare variant MLH1:c.836T>G. Clinical and tumor data strongly indicate that this founder variant is associated with an increased risk for early-onset LS-associated tumors. We also demonstrate that the variant leads to aberrant mRNA splicing. However, the splice effect’s leakiness together with the small effect of the amino acid change p.(Val297Gly) encoded by the residual full-length transcripts in a functional assay preclude its formal classification as (likely) PV according to internationally accepted variant interpretation guidelines. The family histories of the carriers suggest that the obstacles to classify the variant as (likely) PV may be related with a reduced penetrance. Nonetheless, and despite the formal classification of MLH1:c.836T>G as a variant of uncertain significance, we show that carriers should undergo cancer surveillance and predictive testing should be offered to relatives. This variant illustrates the need for an improved classification framework for appropriate categorization of lower-penetrance alleles.