The gene trap technique is a powerful approach for characterizing and mutating genes involved in mouse development. However, one shortcoming of gene trapping is the relative inability to induce subtle mutations. This problem can be overcome by introducing a knock-in system into the gene trap strategy. Here, we have constructed a new gene trap vector, pU-Hachi, employing the Cre-mutated lox system (Araki et al., 1997), in which a pair of mutant lox, lox71 and lox66, was used to promote targeted integrative reaction by Cre recombinase. The pU-Hachi carries splicing acceptor (SA)-lox71-internal ribosomal entry site (IRES)-beta-geo-pA-loxP-pA-pUC. By using this vector, we can carry out random insertional mutagenesis as the first step, and then we can replace the beta-geo gene with any gene of interest through Cre-mediated integration. We have isolated 109 trap clones electroporated with pU-Hachi, and analyzed their integration patterns by Southern blotting to select those carrying a single copy of the trap vector. By use of some of these clones, we have succeeded in exchanging the reporter gene at high efficiency, ranging between 20-80%. This integration system is also quite useful for plasmid rescue to recover flanking genomic sequences, because a plasmid vector sequence can be introduced even when the pUC sequence of the trap vector is lost through integration into the genome. Thus, this method, termed exchangeable gene trapping, has many advantages as the trapped clones can be utilized to express genes with any type of mutation.