Recently identified BLast Colony Forming Cells (BL-CFCs) from in vitro differentiated embryonic stem (ES) cells represent the common progenitor of hematopoietic and endothelial cells, the hemangioblast. Access to this initial cell population committed to the hematopoietic lineage provides a unique opportunity to characterize hematopoietic commitment events. Here, we show that BL-CFC expresses the receptor tyrosine kinase, Flk1, and thus we took advantage of the BL-CFC assay, as well as fluorescent activated cell sorter (FACS) analysis for Flk1⁺ cells to determine quantitatively if mesoderm-inducing factors promote hematopoietic lineage development. Moreover, we have analyzed ES lines carrying targeted mutations for fibroblast growth factor receptor-1 (fgfr1), a receptor for basic fibroblast growth factor (bFGF), as well as scl, a transcription factor, for their potential to generate BL-CFCs and Flk1⁺ cells, to further define events leading to hemangioblast development. Our data suggest that bFGF-mediated signaling is critical for the proliferation of the hemangioblast and that cells expressing both Flk1 and SCL may represent the hemangioblast.