We have developed a gene trap vector that transduces an EGFP-neo fusion gene (Eno) to monitor the expression of trapped genes in living cells and embryos. Upon in vitro differentiation, most gene-trapped embryonic stem (ES) cell clones exhibited detectable green fluorescence in various specialized cell types, which can be followed in the live culture in real time. Populations of ES cell-derived cardiomyocytes, smooth muscle cells, vascular endothelial cells, and hematopoietic cells were readily recognized by their distinctive morphologies coupled with unique activities, allowing efficient screening for clones with trapped genes expressed in cardiovascular lineages. Applying G418 selection in parallel differentiation cultures further increased detection sensitivity and screening throughput by enriching reporter-expressing cells with intensified green fluorescent protein signals. Sequence analyses and chimera studies demonstrated that the expression of trapped genes in vivo closely correlated with the observed lineage specificity in vitro. This provides a strategy to identify and mutate genes expressed in lineages of interest for further functional studies. Developmental Dynamics 229:319–327, 2004. © 2004 Wiley-Liss, Inc.