Human embryonic stem (hES) cells are pluripotent stem cells capable of self-renewal and differentiation into virtually all cell types. Thus, they hold tremendous potential as cell sources for regenerative therapies. The concurrent development of accurate, sensitive, and noninvasive technologies capable of monitoring hES cells engraftment in vivo can greatly expedite basic research prior to future clinical translation. In this study, hES cells were stably transduced with a lentiviral vector carrying a novel double-fusion reporter gene that consists of firefly luciferase and enhanced green fluorescence protein. Reporter gene expression had no adverse effects on cell viability, proliferation, or differentiation to endothelial cells (human embryonic stem cell-derived endothelial cells [hESC-ECs]). To compare the two popular imaging modalities, hES cells and hESC-ECs were then colabeled with superparamagnetic iron oxide particles before transplantation into murine hind limbs. Longitudinal magnetic resonance (MR) imaging showed persistent MR signals in both cell populations that lasted up to 4 weeks. By contrast, bioluminescence imaging indicated divergent signal patterns for hES cells and hESC-ECs. In particular, hESC-ECs showed significant bioluminescence signals at day 2, which decreased progressively over the following 4 weeks, whereas bioluminescence signals from undifferentiated hES cells increased dramatically during the same period. Post-mortem histology and immunohistochemistry confirmed teratoma formation after injection of undifferentiated hES cells but not hESC-ECs. From these data taken together, we concluded that reporter gene is a better marker for monitoring cell viability, whereas iron particle labeling is a better marker for high-resolution detection of cell location by MR. Furthermore, transplantation of predifferentiated rather than undifferentiated hES cells would be more suited for avoiding teratoma formation.