Contrasting results have been reported concerning the association of a splice-site polymorphism (rs10774671) in OAS1 with multiple sclerosis (MS). We analysed two OAS1 regions encompassing alternatively spliced exons. While the region carrying the splice-site variant is neutrally evolving, a signature of long-standing balancing selection was observed across an alternative exon 7. Analysis of variants in this exon identified an insertion/deletion polymorphism (rs11352835, A/−) that originates predicted products with distinct C termini. This variant is located along the major branch of the haplotype genealogy, suggesting that it may represent the selection target. A case/control study for MS indicated that rs11352835 is associated with disease susceptibility (for an allelic model with the deleted allele predisposing to MS, OR 1.27, 95% CI 1.072–1.513, p = 0.010). No association was found between rs10774671 and MS. As the two SNPs are in linkage disequilibrium in Europeans, the previously reported association between rs10774671 and MS susceptibility might be driven by rs11352835, possibly explaining the contrasting results previously observed for the splice-site polymorphism. Thus, we describe a novel susceptibility variant for MS in OAS1 and show that population genetic analyses can be instrumental to the identification of selection targets and, consequently, of functional polymorphisms with an effect on phenotypic traits.