This report describes generation of dendritic cells (DCs) and macrophages from human induced pluripotent stem (iPS) cells. iPS cell-derived DC (iPS-DC) exhibited the morphology of typical DC and function of T-cell stimulation and antigen presentation. iPS-DC loaded with cytomegalovirus (CMV) peptide induced vigorous expansion of CMV-specific autologous CD8+ T cells. Macrophages (iPS-MP) with activity of zymosan phagocytosis and C5a-induced chemotaxis were also generated from iPS cells. Genetically modified iPS-MPs were generated by the introduction of expression vectors into undifferentiated iPS cells, isolation of transfectant iPS cell clone and subsequent differentiation. By this procedure, we generated iPS-MP expressing a membrane-bound form of single chain antibody (scFv) specific to amyloid β (Aβ), the causal protein of Alzheimer's disease. The scFv-transfectant iPS-MP exhibited efficient Aβ-specific phagocytosis activity. iPS-MP expressing CD20-specific scFv engulfed and killed BALL-1 B-cell leukemia cells. Anti-BALL-1 effect of iPS-MP in vivo was demonstrated in a xeno-transplantation model using severe combined immunodeficient mice. In addition, we established a xeno-free culture protocol to generate iPS-DC and iPS-MP. Collectively, we demonstrated the possibility of application of iPS-DC and macrophages to cell therapy.