Spermatogonial stem cells (SSCs) are the only stem cells in the body that transmit genetic information to the next generation. The long-term propagation of rodent SSCs is now possible in vitro, and their genetic modification is feasible. However, their differentiation into sperm is possible only under in vivo conditions. Here we show a new in vitro system that can induce full spermatogenesis from SSC lines or any isolated SSCs. The method depends on an organ culture system onto which SSCs are transplanted. The settled SSCs form colonies and differentiate up into sperm. The resultant haploid cells are fertile, and give rise to healthy offspring through micro-insemination. In addition, the system can induce spermatogenesis from SSCs that show spermatogenic failure due to a micro-environmental defect in their original testes. Thus, an in vitro system is established that can be used to correct or manipulate the micro-environmental conditions required for proper spermatogenesis from murine SSC lines.