The arylhydrocarbon-receptor nuclear translocator (ARNT) is a member of the basic-helix-loop-helix-PAS family of heterodimeric transcription factors which includes the arylhydrocarbon receptor (AHR), hypoxia-inducible factor-1 alpha (HIF-1 alpha) and the Drosophila single-minded protein (Sim)(1-4), ARNT forms heterodimeric complexes with the arylhydrocarbon receptor, HIF-1 alpha, Sim and the PAS protein Per(2,4-6). In response to environmental pollutants, AHR-ARNT heterodimers regulate genes involved in the metabolism of xenobiotics(7-9), whereas ARNT-HIF-1 alpha heterodimers probably regulate those involved in the response to oxygen deprivation(10-13). By generating a targeted disruption of the Arnt locus in the mouse, we show here that Arnt(-/-) embryonic stem cells fail to activate genes that normally respond to low oxygen tension, Arnt(-/-) ES cells also failed to respond to a decrease in glucose concentration, indicating that ARNT is crucial in the response to hypoxia and to hypoglycaemia. Arnt(-/-) embryos were not viable past embryonic day 10.5 and showed defective angiogenesis of the yolk sac and branchial arches, stunted development and embryo wasting, The defect in blood vessel formation in Arnt(-/-) yolk sacs is similar to the angiogenic abnormalities reported for mice deficient in vascular endothelial growth factor(14,15) or tissue factor(16). On the basis of these findings, we propose a model in which increasing tissue mass during organogenesis leads to the formation of hyoxic/nutrient-deprived cells, the subsequent activation of ARNT, and a concomitant increase in the expression of genes (including that encoding vascular endothelial growth factor) that promote vascularization of the developing yolk sac and solid tissues.