To generate a general system capable of specifically testing genes for functions in skeletal joint development, we engineered transgenic mice to express Cre recombinase in developing joints (Figure 1). Gdf5 is a gene strongly expressed in stripes across developing skeletal elements during embryonic joint formation. A bacterial artificial chromosome (BAC) containing the Gdf5 locus was modified by homologous recombination in bacteria to insert a cassette encoding Cre-internal ribosome entry site (IRES)-human placental alkaline phosphatase (hPLAP) into the translation start site of Gdf5 (Figure 1A). This modified BAC was then used to make lines of transgenic mice. The resulting Gdf5-Cre transgenic mice were tested for transgene expression and Cre recombinase activity by crossing them to R26R reporter mice that activate the expression of lacZ after Cre-mediated removal of transcriptional stop sequences (Soriano 1999). The resulting progeny were analyzed both for expression of the transgene by assaying HPLAP activity and for recombination of DNA by assaying LACZ activity. The progeny from all three lines showed strong LACZ expression primarily in joints, and in two of three lines HPLAP expression could also be seen in joint regions. Interestingly, HPLAP expression in the Gdf5-Cre transgenic GAC(A) line used for all subsequent breeding experiments was seen to precede LACZ expression during successive development of joints in the digits (Figure 1C) (unpublished data). These experiments clearly demonstrate that the Gdf5-Cre transgene expresses Cre recombinase and causes DNA recombination in developing joint regions.