Motoneurons represent a specialized class of neurons essential for the control of body movement. Motoneuron loss is the cause of a wide range of neurological disorders including amyotrophic lateral sclerosis and spinal muscular atrophy. Embryonic stem cells are a promising cell source for the study and potential treatment of motoneuron diseases. Here, we present a novel in vitro protocol of the directed differentiation of human embryonic stem cells (hESCs) into engraftable motoneurons. Neural induction of hESCs was induced on MS5 stromal feeders, resulting in the formation of neural rosettes. In response to sonic hedgehog and retinoic acid, neural rosettes were efficiently directed into spinal motoneurons with appropriate in vitro morphological, physiological, and biochemical properties. Global gene expression analysis was used as an unbiased measure to confirm motoneuron identity and type. Transplantation of motoneuron progeny into the developing chick embryo resulted in robust engraftment, maintenance of motoneuron phenotype, and long-distance axonal projections into peripheral host tissues. Transplantation into the adult rat spinal cord yielded neural grafts comprising a large number of human motoneurons with outgrowth of choline acetyltransferase positive fibers. These data provide evidence for in vivo survival of hESC-derived motoneurons, a key requirement in the development of hESC-based cell therapy in motoneuron disease. Disclosure of potential conflicts of interest is found at the end of this article.