Inducible and reversible regulation of gene expression is a powerful approach for uncovering gene function. We have established a general method to efficiently produce reversible and inducible gene knockout and rescue in mice. In this system, which we named iKO, the target gene can be turned on and off at will by treating the mice with doxycycline. This method combines two genetically modified mouse lines: a) a KO line with a tetracycline-dependent transactivator replacing the endogenous target gene, and b) a line with a tetracycline-inducible cDNA of the target gene inserted into a tightly regulated (TIGRE) genomic locus, which provides for low basal expression and high inducibility. Such a locus occurs infrequently in the genome and we have developed a method to easily introduce genes into the TIGRE site of mouse embryonic stem (ES) cells by recombinase-mediated insertion. Both KO and TIGRE lines have been engineered for high-throughput, large-scale and cost-effective production of iKO mice. As a proof of concept, we have created iKO mice in the apolipoprotein E (ApoE) gene, which allows for sensitive and quantitative phenotypic analyses. The results demonstrated reversible switching of ApoE transcription, plasma cholesterol levels, and atherosclerosis progression and regression. The iKO system shows stringent regulation and is a versatile genetic system that can easily incorporate other techniques and adapt to a wide range of applications.