We recently identified the allantois as a site producing hemopoietic and endothelial cells capable of colonizing the bone marrow of an engrafted host. Here, we report a detailed investigation of some early cytological and molecular processes occurring in the allantoic bud, which are probably involved in the production of angioblasts and hemopoietic cells. We show that the allantois undergoes a program characterized by the prominent expression of several "hemangioblastic" genes in the mesoderm accompanied by other gene patterns in the associated endoderm. VEGF-R2, at least from stage HH17 onward, is expressed and is shortly followed by transcription factors GATA-2, SCL/tal-1, and GATA-1. Blood island-like structures differentiate that contain both CD45(+) cells and cells accumulating hemoglobin; these structures look exactly like blood islands in the yolk sac. This hemopoietic process takes place before the establishment of a vascular network connecting the allantois to the embryo. As far as the endoderm is concerned, GATA-3 mRNA is found in the region where allantois will differentiate before the posterior instestinal portal becomes anatomically distinct. Shortly before the bud grows out, GATA-2 was expressed in the endoderm and, at the same time, the hemangioblastic program became initiated in the mesoderm. GATA-3 is detected at least until E8 and GATA-2 until E3 the latest stage examined for this factor. Using in vitro cultures, we show that allantoic buds, dissected out before the establishment of circulation between the bud and the rest of the embryo, produced erythrocytes of the definitive lineage. Moreover, using heterospecific grafts between chick and quail embryos, we demonstrate that the allantoic vascular network develops from intrinsic progenitors. Taken together, these results extend our earlier findings about the commitment of mesoderm to the endothelial and hemopoietic lineages in the allantois. The detection of a prominent GATA-3 expression restricted to the endoderm of the preallantoic region and allantoic bud, followed by that of GATA-2, is an interesting and novel information, in the context of organ formation and endoderm specification in the emergence of hemopoietic cells.