This chapter reviews the use of genetically modified animals and the increasingly detailed knowledge of the genomes of the domestic species. The different approaches to genetic modification are outlined as are the advantages and disadvantages of the techniques in different species. Genetically modified mice have been fundamental in understanding gene function and in generating affordable models of human disease although these are not without their drawbacks. Transgenic farm animals have been developed for nutritionally enhanced food, disease resistance and xenografting. Transgenic rabbits, goats, sheep and cows have been developed as living bioreactors producing potentially high value biopharmaceuticals, commonly referred to as "pharming". Domestic animals are also important as a target as well as for testing genetic-based therapies for both inherited and acquired disease. This latter field may be the most important of all, in the future development of novel therapies.