Abstract: The present invention represents an improvement upon the basic method of generating genetically modified animals, particularly knock-outs, through the injection or aggregation of genetically modified foreign cells with wild type blastocysts or embryos. This improvement comprises the use of animals with permanent or conditional fertility defects as the source of blastocysts/embryos in this process. By using such animals, germ cells derived from the genetically modified foreign cells have a competitive advantage in the process and the frequency of producing genetically modified animals is increased. Chimeric blastocysts or aggregates produced according to this improved method are also part of the invention. In another aspect, the invention teaches the generation and use of an inducibly sterile animal. A method for rendering wild type blastocysts or early stage embryos sterile for reproduction is also contemplated as part of the invention.