It is well known that human cells are diverse with respect to their epigenome, transcriptome, and proteome. In the context of regenerative medicine, it is important for the transplanted cells or tissues to faithfully recapitulate their intended tissue type in each of these respects. Whether the cells chosen for such an application are embryonic, postnatal, or induced pluripotent stem cells, the transplanted product must behave in a predictable and reliable manner to be a safe and effective treatment option. Irrespective of the choice of cells used in such an application, the characterization and understanding of the developmental cues responsible for establishing and maintaining the desired cell phenotype are essential.Animal models are extremely important in understanding the development of a specific tissue, which can then be subsequently extrapolated to human studies. Generation of transgenic animal models with whole-body gene knockout, conditional knockout, constitutive fluorescent gene reporters, and Cre-Lox-based conditional and lineage reporters has revolutionized the field of developmental biology. An intrinsically complex network of the actions and interactions of the multitude of different signalling cascades is required for development. A thorough understanding of such networks, gained through studies on transgenic animal models, is essential for the development of the techniques necessary to reliably differentiate a given stem or progenitor cell population into a specific cell type, such as an islet-like, insulin-producing cell aggregate.In this chapter, we describe the use of GFP (green fluorescent protein)-based reporter mice for isolation of cells of choice, analyzing gene expression in those cells as well as their use for screening signalling molecules to understand their effect on differentiation.