Human induced pluripotent stem (iPS) cells hold great promise for cardiovascular research and therapeutic applications, but the ability of human iPS cells to differentiate into functional cardiomyocytes has not yet been demonstrated. The aim of this study was to characterize the cardiac differentiation potential of human iPS cells generated using OCT4, SOX2, NANOG, and LIN28 transgenes compared to human embryonic stem (ES) cells. The iPS and ES cells were differentiated using the embryoid body (EB) method. The time course of developing contracting EBs was comparable for the iPS and ES cell lines, although the absolute percentages of contracting EBs differed. RT-PCR analyses of iPS and ES cell–derived cardiomyocytes demonstrated similar cardiac gene expression patterns. The pluripotency genes OCT4 and NANOG were downregulated with cardiac differentiation, but the downregulation was blunted in the iPS cell lines because of residual transgene expression. Proliferation of iPS and ES cell–derived cardiomyocytes based on 5-bromodeoxyuridine labeling was similar, and immunocytochemistry of isolated cardiomyocytes revealed indistinguishable sarcomeric organizations. Electrophysiology studies indicated that iPS cells have a capacity like ES cells for differentiation into nodal-, atrial-, and ventricular-like phenotypes based on action potential characteristics. Both iPS and ES cell–derived cardiomyocytes exhibited responsiveness to β-adrenergic stimulation manifest by an increase in spontaneous rate and a decrease in action potential duration. We conclude that human iPS cells can differentiate into functional cardiomyocytes, and thus iPS cells are a viable option as an autologous cell source for cardiac repair and a powerful tool for cardiovascular research.