The Oct4 transcription factor is essential for the self-renewal and pluripotency of embryonic stem cells (ESCs). Oct4 level also controls the fate of ESCs. We analyzed the effects of Oct4 overproduction on the hematopoietic differentiation of ESCs. Oct4 was introduced into ESCs via a bicistronic retroviral vector, and cells were selected on the basis of Oct4 production, with Oct4(+) and Oct4(2+) displaying twofold and three- to fourfold overproduction, respectively. Oct4 overproduction inhibited hematopoietic differentiation in a dose-dependent manner, after the induction of such differentiation by the formation of day 6 embryoid bodies (EB6). This effect resulted from defective EB6 formation rather than from defective hematopoietic differentiation. In contrast, when hematopoiesis was induced by the formation of blast colonies, the effects of Oct4 depended on the level of overproduction: twofold overproduction increased hematopoietic differentiation, whereas higher levels of overproduction markedly inhibited hematopoietic development. This increase or maintenance of Oct4 levels appears to alter the kinetics and pattern of mesoderm commitment, thereby modifying hemangioblast generation. These results demonstrate that Oct4 acts as a master regulator of ESC differentiation.