The bHLH transcription factor SCL plays a central role in the generation of hematopoietic cells in vertebrates. We modified a PAC containing the whole zebrafish scl locus, inserting GFP into the first coding exon of scl. In germline-transgenic zebrafish generated using this construct, GFP expression completely recapitulates the endogenous expression of scl in blood, endothelium and CNS. We performed in vivo timelapse imaging of blood and endothelial precursor migration at the single-cell level and show that these cells migrate from the posterior lateral plate mesoderm to their site of differentiation in the intermediate cell mass. The anterior lateral plate domain of GFP expression gives rise to primitive macrophages and the blood vessels of the head. In later embryos, GFP expression identifies clusters of hematopoietic cells that develop between the dorsal aorta and posterior cardinal veins after primitive erythrocytes have entered circulation. Two treatments that block definitive hematopoiesis (treatment with dioxin (TCDD), and injection of an antisense morpholino oligonucleotide targeted to runx1) ablate these hematopoietic clusters. This indicates that these clusters represent the first site of definitive hematopoiesis in zebrafish. This site is anatomically homologous to the proposed source of hematopoietic stem cells in amniotes, the aorta-gonad-mesonephros (AGM) region. A second transgenic line, containing the promoter of scl driving GFP, lacks expression in the definitive clusters.