The biochemistry of early stages of hematopoietic differentiation is difficult to study because only relatively small numbers of precursor cells are available. The murine EML cell line is a multipotential cell line that can be used to model some of these steps. We found that the lineage- EML precursor cells can be separated into two populations based on cell surface markers including CD34. Both populations contain similar levels of stem cell factor (SCF) receptor (c-Kit) but only the CD34+ population shows a growth response when treated with SCF. Conversely, the CD34- population will grow in the presence of the cytokine IL-3. The human beta-globin locus control region hypersensitive site 2 plays different roles on beta-globin transcription in the CD34+ and CD34- populations. The two populations are present in about equal amounts in culture, and the CD34+ population rapidly regenerates the mixed population when grown in the presence of SCF. We suggest that this system may mimic a normal developmental transition in hematopoiesis.