The differentiation of human pluripotent stem cells to the B-cell lymphoid lineage has important clinical applications that include in vitro modeling of developmental lymphogenesis in health and disease. Here, we first demonstrate the capacity of human induced pluripotent stem cells (hiPSCs) to differentiate into CD144(+)CD73(-)CD43/CD235a(-) cells, characterized as hemogenic endothelium, and show that this population is capable of differentiating to CD10(+)CD19(+) B lymphocytes. We also demonstrate that B lymphocytes generated from hiPSCs are able to undergo full VDJ rearrangement and express surface IgM (sIgM(+)), thus representing an immature B-cell subset. Efficiency of sIgM expression on the hiPSC-derived B lymphocytes (∼ 5% of CD19(+) cells) was comparable with B lymphocytes generated from human umbilical cord blood (UCB) hematopoietic progenitor cells. Importantly, when assessed by global transcriptional profiling, hiPSC-derived B-cells show a very high level of similarity when compared with their UCB-derived counterparts, such that from more than 47,000 different transcripts, only 45 were significantly different (with a criteria adjusted P value P<0.05, log FC >1.5 or 2.8-fold). This represents a unique in vitro model to delineate critical events during lymphogeneisis in development and lymphoid diseases such as acute lymphocytic leukemia.