Inactivation of the von Hippel-Lindau (VHL) tumor suppressor gene leads to the development of central nervous system hemangioblastomas, pheochromocytomas and renal cell carcinomas. The biological role of the VHL gene during development is poorly understood because of early lethality of VHL-null embryos. To overcome early embryo lethality observed in the conventional knockout mouse, we introduced a tamoxifen-inducible Cre (CreER(TM)) transgene for the stage specific inactivation of the VHL gene. Acute tamoxifen-induced inactivation of the VHL gene at E10.5 resulted in embryonic lethality between E14.5 and E15.0 with extensive hemorrhage and necrosis, while littermate controls showed normal development. Examination of the VHL-inactivated embryos between E10.5 and E14.5 revealed dilated blood vessels, hemorrhage and necrotizing liver damage. Concomitant with severe hemorrhage and abnormal vasculature at E15.0, blood circulation in the yolk sac was impaired in the VHL-inactivated embryos, which may be the cause of embryo death. Placental development looked normal before embryo death (E14.5); however, at E16.5 following embryo death, we observed reduced growth of the placental labyrinthine layer. Inactivation of the VHL gene resulted in hypoxia-inducible factor (HIF)-1alpha stabilization and induction of its target genes, VEGF and CAIX, in mouse embryonic fibroblasts (MEFs). In addition, we observed lactate overproduction and acidification of culture media by the inactivation of the VHL gene. Thus, by using a novel conditional VHL knockout mouse model, we could show that the VHL gene plays an important role in the developing vasculature and liver during embryogenesis through regulation of HIF-1alpha and its target genes. This mouse model will be useful for the screening of anti-HIF or anti-VEGF drugs in vivo. Additionally, this acute VHL inactivation system may provide a useful tool for the in vivo study of genes that cause early embryonic lethality.