Cell replacement therapy of severe degenerative diseases such as diabetes, myocardial infarction and Parkinson's disease through transplantation of somatic cells generated from embryonic stem (ES) cells is currently receiving considerable attention for the therapeutic applications. ES cells harvested from the inner cell mass (ICM) of the early embryo, can proliferate indefinitely in vitro while retaining the ability to differentiate into all somatic cells thereby providing an unlimited renewable source of somatic cells. In this context, identifying soluble factors, in particular chemically synthesized small molecules, and signal cascades involved in specific differentiation processes toward a defined tissue specific cell type are crucial for optimizing the generation of somatic cells in vitro for therapeutic approaches. However, experimental models are required allowing rapid and "easy-to-handle" parallel screening of chemical libraries to achieve this goal. Recently, the forward chemical genetic screening strategy has been postulated to screen small molecules in cellular systems for a specific desired phenotypic effect. The current review is focused on the progress of ES cell research in the context of the chemical genetics to identify small molecules promoting specific differentiation of ES cells to desired cell phenotype. Chemical genetics in the context of the cell ES-based cell replacement therapy remains a challenge for the near future for several scientific fields including chemistry, molecular biology, medicinal physics and robotic technologies.