Embryonic stem (ES) cells are in vitro cultivated pluripotent cells derived from the inner cell mass (ICM) of the embryonic blastocyst. Attesting to their pluripotency, ES cells can be differentiated into representative derivatives of all three embryonic germ layers (endoderm, ectoderm and mesoderm) both in vitro and in vivo. Although mouse ES cells have been studied for many years, human ES cells have only more recently been derived and successfully propagated. Many biochemical differences and culture requirements between mouse and human ES cells have been described, yet despite these differences the study of murine ES cells has provided important insights into methodologies aimed at generating a greater and more in depth understanding of human ES cell biology. One common feature of both mouse and human ES cells is their capacity to undergo controlled differentiation into spheroid structures termed embryoid bodies (EBs). EBs recapitulate several aspects of early development, displaying regional-specific differentiation programs into derivatives of all three embryonic germ layers. For this reason, EB formation has been utilised as an initial step in a wide range of studies aimed at differentiating both mouse and human ES cells into a specific and desired cell type. Recent reports utilising specific growth factor combinations and cell-cell induction systems have provided alternative strategies for the directed differentiation of cells into a desired lineage. According to each one of these strategies, however, a relatively high cell lineage heterogeneity remains, necessitating subsequent purification steps including mechanical dissection, selective media or fluorescent or magnetic activated cell sorting (FACS and MACS, respectively). In the future, the ability to specifically direct differentiation of human ES cells at 100% efficiency into a desired lineage will allow us to fully explore the potential of these cells in the analysis of early human development, drug discovery, drug testing and repair of damaged or diseased tissues via transplantation.