Gene targeting is one of the most powerful tools to define the role of signaling molecules in animal development and disease etiology. By using this technique, nearly 1000 knockout mice have been produced over the last two decades. Generating knockout mice, however, is a time-consuming procedure. Also, an unexpected embryonic lethality sometimes prevents us from examining the function of the gene in specific tissues. Here, we describe a convenient method to directly disrupt genes at both alleles in murine embryonic stem (ES) cells. These homozygous knockout ES cells have been shown useful to determine the role of the genes in the mediation of various cellular activities such as proliferation, differentiation, apoptosis, survival, transformation, and so on. Furthermore, with the recent advance of in vitro differentiation techniques, it is now feasible to rapidly determine the role of specific molecules in particular tissues.