This research area comprises several fields (including cellular reprogramming, transdifferentiation and stem cell biology) in which major breakthroughs are expected by use of the technology involved in establishing induced pluripotent stem (iPS) cells. Basic research on pioneering new approaches or having the potential for clinical medicine will be also involved. Specifically included are 1) advancing and simplifying reprogramming technologies based on the molecular mechanisms of cellular reprogramming, 2) analysis and directed induction of stem cell differentiation and transdifferentiation processes, 3) elucidation of the molecular mechanisms underlying epigenetic alteration during iPS formation, 4) elucidation of pathogenesis of various diseases through the effective use of iPS cells, and 5) development of animal models for human diseases using iPS cells. We believe that the results of this research will contribute to the identification of the causes of diseases as well as to the development of new therapeutic drugs and pave the way to realize cell transplant treatments without ethical problems and immunologic rejection.