Genetic modification of human embryonic stem cells (hESCs) will be an essential tool to allow full exploitation of these cells in regenerative medicine and in the study of hESC biology. Here we report multiple sequential modifications of an endogenous gene (hprt) in hESCs. A selectable marker flanked by heterospecific lox sites was first introduced by homologous recombination (HR) into the hprt gene. In a subsequent step, exchange of the selectable marker with another cassette was achieved by recombinase-mediated cassette exchange (RMCE). We show that 100% of the recovered clones were the result of RMCE using a promoter trap strategy at the hprt locus. hprt-targeted H1 cells maintained a diploid karyotype and expressed hESC surface markers before and after RMCE. Finally, we report a double replacement strategy using two sequential gene targeting steps resulting in the targeted correction of an hprt-mutated hESC line.