Sickle-cell disease (SCD) is characterized by a single point mutation in the seventh codon of the beta-globin gene. Site-specific correction of the sickle mutation in adult bone marrow hematopoietic stem cells (HSCs) would allow for permanent production of normal red blood cells. Site-specific correction can be achieved using proteins called zinc-finger nucleases (ZFNs) which recognize and bind the region of the genome surrounding the sickle mutation. The ZFNs are able to create a break in the DNA which the cells repair using existing repair machinery. If, at the time of repair, a homologous donor template containing the corrective base is present, the cells’ repair machinery can use this template and the resulting cell genome will contain the wild-type base instead of the sickle mutation. By doing this in hematopoietic setm cells, the cell is permanently corrected and each red blood cell (RBC) derived from this corrected stem cell will produce normal, non-sickle RBCs. In this report, we show efficient targeted cleavage by the ZFNs at the beta-globin locus with minimal off-target modification. In addition, we compare two different homologous donor templates (an integrase-defective lentiviral vector [IDLV] and a single-stranded DNA oligonucleotide [oligo]) to determine the optimal donor template. In both wild-type as well as sickle cell disease patient CD34+ HSCs, we are able to deliver the ZFN and donor templates and specifically correct the genome at rates of up to 30%. When these cells are differentiated into RBCs in vitro, we demonstrate that they are not altered in their differentiation capacity and are able to produce wild-type hemoglobin at high levels (35% of all hemoglobins) by HPLC. These results provide a strong basis for moving forward with this work as we begin our efforts to increase the number of treated cells to achieve clinical levels of corrected cells as well as characterize the ability of these cells to engraft a murine model in vivo. The progress made in this year is an exciting step towards a clinical therapy and potential treatment for sickle cell disease.