Diverse types of blood cell (lineages) are produced from rare haematopoietic stem cells that reside in the bone marrow. This process, known as haematopoiesis, provides a valuable model for examining how genetic programs are established and executed in vertebrates, and also how homeostasis of blood formation is altered in leukaemias. So, how does an apparently small group of critical lineage-restricted nuclear regulatory factors specify the diversity of haematopoietic cells? Recent findings not only indicate how this may be achieved but also show the extraordinary plasticity of tissue stem cells in vivo.