Bacterial artificial chromosomes (BAC) are F-factor plasmid based vectors that are maintained as 1 or 2 copy plasmids in their bacterial host strain. BACs have the capacity for maintaining large, often more than 300 kb fragments of mammalian DNA as stable inserts and avoid much of the insert chimerism which characterizes yeast artificial chromosomes (YACs). Isolation of BAC DNA is easy because they exist as supercoiled circular plasmids that are resistant to shearing (1 ). These advantages have made BACs into an important tool for genome research (2 ). BACs are also being increasingly used as a tool for exploring the function of large genomic fragments either by generating transgenic animals by oocytes pronuclear injection (3 –5 ) or by creating transgenic ES cell lines by liposome-mediated transfection (6 ). The most widely used BAC vectors such as pBeloBAC11 or pBACe3.6 (7 ,8 ) lack the selection markers necessary for easeful transfection study in mammalian cells. To use such BAC clones for transfection analysis, it is usually necessary to retrofit selectable marker gene cassettes, which will both allow the positive selection of the transfectant and facilitate the stable maintenance of the transgene in mammalian cells. Functional analysis of the genomic elements lying within the BAC, may also require the targeted modification of the insert in order to create point mutations, deletions, and substitutions within the sequence. Development of BAC modification technology is therefore of critical importance and several different techniques to address this issue have been developed (5 ,6 ,9 –11 ). Some of these techniques are described in other chapters in this volume.