Zinc-finger nickases (ZFNickases) are a type of programmable nuclease that can be engineered from zinc-finger nucleases to induce site-specific single-strand breaks or nicks in genomic DNA, which result in homology-directed repair. Although zinc-finger nuclease-mediated gene disruption has been demonstrated in pigs and cattle, they have not been used to target gene addition into an endogenous gene locus in any large domestic species. Here we show in bovine fetal fibroblasts that targeting ZFNickases to the endogenous β-casein (CSN2) locus stimulates lysostaphin gene addition by homology-directed repair. We find that ZFNickase-treated cells can be successfully used in somatic cell nuclear transfer, resulting in live-born gene-targeted cows. Furthermore, the gene-targeted cows secrete lysostaphin in their milk and in vitro assays demonstrate the milk's ability to kill Staphylococcus aureus. Our success with this strategy will facilitate new transgenic technologies beneficial to both agriculture and biomedicine.