Gene targeting in mouse embryonic stem cells is an essential, yet still very expensive and highly time-consuming, tool and method to study gene function at the organismal level or to create mouse models of human diseases. Conventional cloning-based methods have been largely used for generating targeting vectors, but are hampered by a number of limiting factors, including the variety and location of restriction enzymes in the gene locus of interest, the specific PCR amplification of repetitive DNA sequences, and cloning of large DNA fragments. Recombineering is a technique that exploits the highly efficient homologous recombination function encoded by λ phage in Escherichia coli. Bacteriophage-based recombination can recombine homologous sequences as short as 30–50 bases, allowing manipulations such as insertion, deletion, or mutation of virtually any genomic region. The large availability of mouse genomic bacterial artificial chromosome (BAC) libraries covering most of the genome facilitates the retrieval of genomic DNA sequences from the bacterial chromosomes through recombineering. This chapter describes a successfully applied protocol and aims to be a detailed guide through the steps of generation of targeting vectors through recombineering.