Progress has been made in understanding the molecular mechanisms that regulate cell type-specific gene expression during the terminal differentiation of cells into specialized tissue types. These studies have concentrated largely on defining the cis elements and trans-acting factors responsible for the transcription of differentiation-specific genes. Valuable as these investigations have been, they have not been able to place differentiation into the larger context of development, specifically into the context of the earlier developmental process of cell determination, when embryonic stem cell lineages are formed and the genetic regulatory programs for cell type-specific gene activation and expression are acquired by stem cells. The clonal mouse embryo cell line, C3H/10T1/2, clone 8 (10T1/2) provides a unique opportunity to examine the molecular genetic regulation of both the developmental determination of vertebrate stem cell lineages and their subsequent differentiation. 10T1/2 is an apparently multipotential cell line that can be converted by 5-azacytidine into three mesodermal stem cell lineages. These determined proliferative stem cells are stable in culture and retain their ability to differentiate in mitogen-depleted medium. The most significant discovery has been that 10T1/2 lineage determination is under simple genetic control and that the regulatory genes that mediate the formation of myogenic cell lineages, and likely the chondrogenic and adipogenic lineages, can be demonstrated and studied by genomic DNA and cDNA transfection approaches. This paper is a description of the remarkable properties and genetic behaviors of the 10T1/2 cells and a discussion of the insights that future studies of this cell may provide.