The ultimate goal of the proposed study is to identify approaches to increase the production of therapeutically useful blood cells from human ESCs and patient-specific iPSCs. Currently, bone marrow transplantation is the best way to cure many blood-related disorders, such as sickle cell anemia, thalassemia, and blood cancers like leukemia. Furthermore, blood transfusion is an effective way to rapidly counteract blood cell loss due to ablative treatments, such as chemotherapy and radiation therapy. Unfortunately, the limiting factor in transplantation and transfusion treatments is the lack of matched donors. The ability to producing unlimited numbers of blood stem cells and/or functioning differentiated blood cells from human ESCs and patient-derived iPSCs will greatly improve the opportunity of such treatments. Transcription factors play important roles in regulating cell proliferation and differentiation. RUNX1 is a transcription factor that is expressed in blood cells and regulates the expression of many blood cell related genes. Therefore, the specific aim of our studies is to examine the effect of RUNX1 on blood cell formation, expansion, and differentiation from human embryonic stem cells and induced pluripotent stem cells. During the second year of funding period, we have performed hematopoietic cell differentiation using both human ESCs and iPSCs in the presence and absence of this transcription factor. Our results indicate that this factor promotes the production of blood stem cells and progenitors. We will make additional amount of this factor and further confirm our initial finding.