Induced pluripotent stem (iPS) cells offer a unique potential for understanding the molecular basis of disease and development. Here we have generated several human iPS cell lines, and we describe their pluripotent phenotype and ability to differentiate into erythroid cells, monocytes, and endothelial cells. More significantly, however, when these iPS cells were differentiated under conditions that promote lympho-hematopoiesis from human embryonic stem cells, we observed the formation of pre-B cells. These cells were CD45(+)CD19(+)CD10(+) and were positive for transcripts Pax5, IL7αR, λ-like, and VpreB receptor. Although they were negative for surface IgM and CD5 expression, iPS-derived CD45(+)CD19(+) cells also exhibited multiple genomic D-J(H) rearrangements, which supports a pre-B-cell identity. We therefore have been able to demonstrate, for the first time, that human iPS cells are able to undergo hematopoiesis that contributes to the B-cell lymphoid lineage.