Myc family proteins are thought to be transcription factors involved in regulation of cell growth and differentiation. N-myc is expressed at the pre-B cell stage of B cell differentiation and is dramatically induced by the pre-B cell growth factor, IL-7. To test the idea that N-myc plays an important role in lymphocyte development, we assayed the effect of a null N-myc mutation on the differentiation of B and T lineage cells. Homozygous, mutant embryonic stem (ES) cells were injected into blastocysts derived from recombination activating gene (RAG-2)-deficient mice. Since RAG-2 mutant mice fail to develop mature lymphocytes, later-stage lymphocytes that are present in chimeric mice are ES cell derived. Surprisingly, nearly normal numbers of mature T and B cells derived from N-myc-deficient ES cells were found in peripheral lymphoid organs of chimeric mice. Lymphocytes were judged to be functional based on responses to mitogens and production of serum IgM and multiple IgG isotypes in chimeric animals. We discuss these findings in relation to N-myc function in lymphocyte development and possible redundancy with other myc genes.