In this study, we examined the signaling pathways activated by Wnt5a in endothelial differentiation of embryonic stem (ES) cells and the function of Wnt5a during vascular development. We first found that Wnt5a −/− mouse embryonic stem (mES) cells exhibited a defect in endothelial differentiation, which was rescued by addition of Wnt5a, suggesting that Wnt5a is required for endothelial differentiation of ES cells. Involvement of both β-catenin and protein kinase (PK)Cα pathways in endothelial differentiation of mES cells requiring Wnt5a was indicated by activation of both β-catenin and PKCα in Wnt5a +/− but not in Wnt5a −/− mES cells. We also found that β-catenin or PKCα knockdowns inhibited the Wnt5a-induced endothelial differentiation of ES cells. Moreover, the lack of endothelial differentiation of Wnt5a −/− mES cells was rescued only by transfection of both β-catenin and PKC α, indicating that both genes are required for Wnt5a-mediated endothelial differentiation. Wnt5a was also found to be essential for the differentiation of mES cells into immature endothelial progenitor cells, which are known to play a role in repair of damaged endothelium. Furthermore, a defect in the vascularization of the neural tissue was detected at embryonic day 14.5 in Wnt5a −/− mice, implicating Wnt5a in vascular development in vivo. Thus, we conclude that Wnt5a is involved in the endothelial differentiation of ES cells via both Wnt/β-catenin and PKC signaling pathways and regulates embryonic vascular development.