Cellular therapies derived from embryonic stem (ES) cells have gained a renewed interest with the experimental demonstration that an embryonic stem cell lines can be established from human blastocyst-stage embryos and prompted to differentiate into almost all types of cells present in the body including hematopoietic cells. Hematopoiesis is a series of cellular processes whereby short-lived mature blood cells are continuously replenished from a pool of rare pluripotential hematopoietic stem cells, in a highly orchestrated process. Aberrances in this intricate process may lead to a malignancy of essential blood-forming organs, causing diseases such as leukemia, aplastic anemia, lymphoma, myelodysplasia and myeloproliferative disorders. Embryonic stem cells show great potential and it may be technologically feasible to transplant differentiated ES cells and to cure various kinds of blood disorders. Understanding the biology of ES cell derived hematopoiesis may lead to the development of co-transplantation protocols that will result in a decreased morbidity and mortality by providing safer and simpler transplantation procedures for patients with malignant and non-malignant conditions. The potential utility of ES cells for gene therapy, tissue engineering and the treatment of a wide variety of currently untreatable diseases is simply too essential to ignore, however, our knowledge and ability to deliver these forms of therapy in a safe and efficient manner requires additional advances in the understanding of the basic biology of ES cells. In this article, we will discuss the factors and methodologies responsible for the differentiation of ES cells into hematopoietic progenitors and their potential to treat different blood related diseases.