The antibiotic resistance gene neomycin phosphotransferase (neo) has been precisely targeted to a chromosomal region close to the cystic fibrosis (CF) locus on chromosome 7. The chromosomal target was the expressed SV40 array integrated at chromosome 7, band q31-q35 in a human-mouse hybrid cell line that contains chromosome 7 as the only human component. Stringent selection for neo expression by homologous recombination (3 of 11 correctly targeted) was achieved by fusing the SV40 large T antigen gene, in frame, to neo in a promoterless construct, such that G418 resistance depended on endogenous promoter function and read-through transcription. Chromosome-mediated gene transfer (CMGT) with G418 selection was then used generate mouse hybrids that carried the targeted locus intact, but retained only a fragment of human chromosome 7. This gene targeting strategy will access new regions of the human (or other mammalian) genome, create precise mutations efficiently by gene disruption, and potentially restore normal gene function by mutation correction.