To elucidate the in vivo function of GATA-1 during hematopoiesis, we specifically disrupted the erythroid promoter of the GATA-1 gene in embryonic stem cells and generated germ line chimeras. Male offspring of chimeras bearing the targeted mutation were found to die by 12.5 days post coitus due to severe anemia while heterozygous females displayed characteristics ranging from severe anemia to normal erythropoiesis. When female heterozygotes were crossed with transgenic males carrying a reporter gene, which specifically marks primitive erythroid progenitors, massive accumulation of undifferentiated erythroid cells were observed in the yolk sacs of the GATA-1-mutant embryos, demonstrating that GATA-1 is required for the terminal differentiation of primitive erythroid cells in vivo.