The moss Physcomitrella patens is used as a genetic model system to study plant development, taking advantage of the fact that the haploid gametophyte dominates in its life cycle. Transformation experiments designed to target three single-copy genomic loci were performed to determine the efficiency of gene targeting in this plant. Mean transformation rates were 10-fold higher with the targeting vectors and molecular evidence for the integration of exogenous DNA into each targeted locus by homologous recombination is provided. The efficiency of gene targeting determined in these experiments is above 90%, which is in the range of that observed in yeast and several orders of magnitude higher than previous reports of gene targeting in plants. Thus, gene knock-out and allele replacement approaches are directly accessible to study plant development in the moss Physcomitrella patens. Moreover, efficient gene targeting has so far only been observed in lower eukaryotes such as protozoa, yeasts and filamentous fungi, and, as shown here the first example from the plant kingdom is a haplobiontic moss. This suggests a possible correlation between efficient gene targeting and haplophase in eukaryotes.