The goal of this grant is to investigate the cell intrinsic mechanisms that govern hematopoietic stem cell specification and self-renewal. During the second year of this award, we have further elucidated the regulatory mechanisms that dictate hematopoietic fate specification by validating the target genes that Scl/tal1 activates and represses in vivo (Aim 1). We have also shown that loss of Scl results not only results in loss of all blood cells, but also causes defective arterio-venous identity that precludes generation of hemogenic endothelium and hematopoietic stem cells. We have defined the phenotype of hemogenic endothelium and emerging HSCs in both mouse and human embryos (Aim 2), and identified novel markers that can be used to isolate developing HSCs at distinct stages, as well as to purify functional HSCs further (Aim 3). We have also established an inducible lentiviral based expression system that will now be used to test functionally candidate HSC regulators that were identified by comparing gene expression profiles between freshly isolated HSCs and dysfunctional HSCs that were expanded in culture or generated from human ES cells. We hope that these studies will provide better understanding of the key regulatory mechanisms that govern HSC properties, and ultimately lead to development of improved methods for generation of functional HSCs in culture.