Embryonic stem (ES) cells differentiate into multiple hematopoietic lineages during embryoid body formation in vitro, but to date, an ES-derived hematopoietic stem cell has not been identified and subjected to clonal analysis in a manner comparable with hematopoietic stem cells from adult bone marrow. As the chronic myeloid leukemia-associated BCR/ABL oncogene endows the adult hematopoietic stem cell with clonal dominance without inhibiting pluripotent lymphoid and myeloid differentiation, we have used BCR/ABL as a tool to enable engraftment and clonal analysis. We show that embryoid body-derived hematopoietic progenitors expressing BCR/ABL maintain a primitive hematopoietic blast stage of differentiation and generate only primitive erythroid cell types in vitro. These cells can be cloned, and when injected into irradiated adult mice, they differentiate into multiple myeloid cell types as well as T and B lymphocytes. While the injected cells express embryonic (beta-H1) globin, donor-derived erythroid cells in the recipient express only adult (beta-major) globin, suggesting that these cells undergo globin gene switching and developmental maturation in vivo. These data demonstrate that an embryonic hematopoietic stem cell arises in vitro during ES cell differentiation that constitutes a common progenitor for embryonic erythroid and definitive lymphoid-myeloid hematopoiesis.