The c-myc proto-oncogene, which is crucial for the progression of many human cancers, has been implicated in key cellular processes in diverse cell types, including endothelial cells that line the blood vessels and are critical for angiogenesis. The de novo differentiation of endothelial cells is known as vasculogenesis, whereas the growth of new blood vessels from pre-existing vessels is known as angiogenesis. To ascertain the function of c-myc in vascular development, we deleted c-myc in selected cell lineages. Embryos lacking c-myc in endothelial and hematopoietic lineages phenocopied those lacking c-myc in the entire embryo proper. At embryonic day (E) 10.5, both mutant embryos were grossly normal, had initiated primitive hematopoiesis, and both survived until E11.5-12.5, longer than the complete null. However, they progressively developed defective hematopoiesis and angiogenesis. The majority of embryos lacking c-myc specifically in hematopoietic cells phenocopied those lacking c-myc in endothelial and hematopoietic lineages, with impaired definitive hematopoiesis as well as angiogenic remodeling. c-myc is required for embryonic hematopoietic stem cell differentiation, through a cell-autonomous mechanism. Surprisingly, c-myc is not required for vasculogenesis in the embryo. c-myc deletion in endothelial cells does not abrogate endothelial proliferation, survival, migration or capillary formation. Embryos lacking c-myc in a majority of endothelial cells can survive beyond E12.5. Our findings reveal that hematopoiesis is a major function of c-myc in embryos and support the notion that c-myc functions in selected cell lineages rather than in a ubiquitous manner in mammalian development.