Objectives: Defining methods for the efficient transduction of fetal stem cells could lead to novel fetal therapies for blood cell disorders and other birth defects. In this study, we analyzed the effects of various parameters on the retroviral transduction of primitive hematopoietic progenitors/stem cells isolated from fetal liver. Methods: Candidate stem cells were isolated by fluorescence-activated cell sorting from midtrimester human livers based on the phenotype CD38–CD34++lineage– (lineage = glycophorin A, CD3, CD14, CD19, CD20 and CD56). A murine retroviral vector with a truncated human low-affinity nerve growth factor receptor (ΔNGFR) gene was used to transduce the candidate stem cells. Marker gene expression was monitored by flow cytometry using an anti-NGFR mAb. Candidate stem cells were transduced immediately after isolation or after up to 4 days of culture in serum-deprived medium containing the growth factors kit ligand and granulocyte-macrophage colony-stimulating factor. The effects on transduction efficiency of the addition of 4 µg/ml protamine sulfate and/or centrifugation to concentrate the candidate stem cells and virus were tested. After transduction, the cells were expanded for 10–21 days before determining the frequency of NGFR+ cells among the different hematopoietic progeny. Results: Efficient transduction of candidate stem cells, at an average rate of 46%, was achieved after 3 days of culture with a single exposure to virus. Longer than 3 days of culture or repeated exposure to viral supernatant did not significantly improve the rate of transduction. The use of centrifugation at 1,200 g for 1 h and the addition of protamine sulfate during the transduction procedure were critical to achieving a high rate of transduction. Marker gene expression was observed on the progeny of the transduced cells in conjunction with CD34 (progenitors), glycophorin A (erythrocytes), CD14 (monocytes), CD15 (granulocytes) and CD41 (megakaryocytes). Conclusions: This study demonstrates that the efficient transduction of fetal candidate stem cells can be achieved under defined culture conditions using a retroviral vector. These results encourage further examination of in utero and ex utero gene therapy as a means of treating birth defects.