Transcription factor GATA-1 is essential for red blood cell maturation and, therefore, for survival of developing mouse embryos. GATA-1 is also expressed in megakaryocytes, mast cells, eosinophils, multipotential hematopoietic progenitors and Sertoli cells of the testis, where its functions have been elusive. Indeed, interpretation of gene function in conventional knockout mice is often limited by embryonic lethality or absence of mature cells of interest, creating the need for alternate methods to assess gene function in selected cell lineages. Emerging strategies for conditional gene inactivation through site-specific recombinases rely on the availability of mouse strains with high fidelity of transgene expression and efficient, tissue-restricted DNA excision. In an alternate approach, we modified sequences upstream of the GATA-1 locus in embryonic stem cells, including a DNase I-hypersensitive region. This resulted in generation of mice with selective loss of megakaryocyte GATA-1 expression, yet sufficient erythroid cell levels to avoid lethal anemia. The mutant mice have markedly reduced platelet numbers, associated with deregulated megakaryocyte proliferation and severely impaired cytoplasmic maturation. These findings reveal a critical role for GATA-1 in megakaryocyte growth regulation and platelet biogenesis, and illustrate how targeted mutation of cis-elements can generate lineage-specific knockout mice.