Homozygosity for a null mutation in the scl gene causes mid-gestational embryonic lethality in the mouse due to failure of development of primitive hematopoiesis. Whilst this observation established the role of the scl gene product in primitive hematopoiesis, the death of the scl null embryos precluded analysis of the role of scl in later hematopoietic development. To address this question, we created embryonic stem cell lines with a homozygous null mutation of the scl gene (scl-/-) and used these lines to derive chimeric mice. Analysis of the chimeric mice demonstrates that the scl-/- embryonic stem cells make a substantial contribution to all non-hematopoietic tissues but do not contribute to any hematopoietic lineage. These observations reveal a crucial role for the scl gene product in definitive hematopoiesis. In addition, in vitro differentiation assays with scl-/- embryonic stem cells showed that the scl gene product was also required for formation of hematopoietic cells in this system.