Chromosomal rearrangements are the major cause of inherited human disease and fetal loss. Translocations and loss of heterozygosity are important genetic changes causally involved in neoplasia. Chromosomal variants, such as deficiencies, are commonly exploited in genetic screens in organisms such as Drosophila because a small portion of the genome is functionally hemizygous. In the mouse, deficiencies are not generally available, thus genetic screens for recessive mutations are cumbersome. We report here that defined deficiencies, inversions and duplications extending to 3-4 cM can be constructed in embryonic stem cells. This was achieved by consecutive targeting of loxP recombination substrates to the end points of a genetic interval followed by Cre-induced recombination. This reconstructs a positive selectable marker which facilitates direct selection of clones with a chromosome structure specific to the relative orientation of the loxP sites. Duplication and deletion alleles have been transmitted into the mouse germ line. The availability of mice with defined regions of segmental haploidy will allow their use in genetic screens and enable accurate models of human 'chromosomal' diseases to be generated.