Insertion of genes into hematopoietic stem cells has several potential therapeutic applications. Needed is an efficient method for gene insertion and sufficient knowledge about gene regulation to allow design of vectors that insure expression of the transferred gene in the appropriate hematopoietic lineage. We have shown that mouse hematopoietic stem cells can be rendered susceptible to infection by recombinant retroviral vectors by culture in interleukin-3 and interleukin-6. The gene that confers resistance to various chemo-therapeutic agents, multiple drug resistance gene-1 (MDR-1), has been inserted into murine stem cells, rendering these cells resistant to the drug, Taxol. Administration of Taxol allows amplification of the stem cell population containing the transferred gene. In a second project, we have inserted a specific mouse histocompatibility gene (K(b)) into stem cells and transplanted these cells into a mouse strain lacking this antigen. Reconstitution with genetically modified bone marrow cells renders the recipient mouse tolerant of skin grafts expressing the K (b) gene. A third project focuses on development of retroviral vectors suitable for transfer and expression of the human beta globin gene. Regulatory elements from the human locus control region have been incorporated in an effort to achieve high level, erythroid specific expression.