Embryonic stem (ES) cells could potentially serve as an excellent cell source for various applications in regenerative medicine and tissue engineering. Our laboratory is particularly interested in generating a reproducible endothelial cell source for the development of prevascularized materials for tissue/organ reconstruction. After developing methods to isolate highly purified (>96%) proliferating populations of endothelial cells from mouse embryonic stem cells, we tested their ability to form three-dimensional (3-D) vascular structures in vitro. The ES cell-derived endothelial cells were embedded in 3-D collagen gel constructs with rat tail collagen type I (2 mg/mL) at a concentration of 10(6) cells/mL of gel. The gels were observed daily with a phase-contrast microscope to analyze the time course for endothelial cell assembly. The first vessels were observed between days 3 and 5 after gel construct formation. The number and complexity of structures steadily increased, reaching a maximum before beginning to regress. By 2 weeks, all vessel-like structures had regressed back to single cells. Histology and fluorescent images of the vessel-like structures verified that tube structures were multicellular and could develop patent lumens. We have shown that endothelial cells derived, purified and expanded in vitro from ES cells sustain an important endothelial cell function, the ability to undergo vasculogenesis in collagen gels, indicating that endothelial products derived in vitro from stem cells could be useful in regenerative medicine applications.