In 2007 Capecchi, Evans, and Smithies received the Nobel Prize in recognition for discovering the principles for introducing specific gene modifications in mice via embryonic stem cells, a technology, which has revolutionized the field of biomedical science allowing for the generation of genetically engineered animals. Here we describe detailed protocols based on and developed from these ground-breaking discoveries, allowing for the modification of genes not only to create mutations to study gene function but additionally to modify genes with fluorescent markers, thus permitting the isolation of specific rare wild-type and mutant cell types for further detailed analysis at the biochemical, pathological, and genomic levels.