The alpha i2 subunit of the inhibitory heterotrimeric guanine nucleotide-binding proteins is highly conserved in mammals and is expressed in all cell types, but its exact function is not yet defined. We have investigated the role of this protein by producing embryonic stem (ES) cells lacking a functional alpha i2 gene. These alpha i2-null cell lines regulate adenylyl cyclase and grow and differentiate in vitro the same as wild-type ES cells. Homologous recombination was used to sequentially inactivate both copies of the alpha i2 gene. The first allele was inactivated by insertion of a neomycin-resistance gene. We modified the hygromycin B-resistance gene for improved expression in ES cells and used this gene to inactivate the remaining normal allele. The techniques used should be generally applicable to other genes whether or not they are expressed in ES cells.