Effective establishment of the hematopoietic and vascular systems is prerequisite for successful embryogenesis. The ETS transcription factor Etv2 has proven to be essential for hematopoietic and vascular development. Etv2 expression marks the onset of the hematopoietic and vascular development and its deficiency leads to an absolute block in hematopoietic and vascular development. Etv2 is transiently expressed during development and is mainly expressed in testis in adults. Consistent with its expression pattern, Etv2 is transiently required for the generation of the optimal levels of the hemangiogenic cell population. Deletion of this gene after the hemangiogenic progenitor formation leads to normal hematopoietic and vascular development. Mechanistically, ETV2 induces the hemangiogenic program by activating blood and endothelial cell lineage specifying genes and enhancing VEGF signaling. Moreover, ETV2 establishes an ETS hierarchy by directly activating other Ets genes, which in the face of transient Etv2 expression, presumably maintain blood and endothelial cell program initiated by ETV2 through an ETS switching mechanism. Current studies suggest that the hemangiogenic progenitor population is exclusively sensitive to ETV2-dependent FLK1 signaling. Any perturbation in the ETV2, VEGF, and FLK1 balance causing insufficient hemangiogenic progenitor cell generation would lead to defects in hematopoietic and endothelial cell development.