Gene targeting (GT) by homologous recombination offers the best precision for genome editing in mice. nanos3 is a highly conserved gene and encodes a zinc-finger RNA binding protein essential for germ stem cell maintenance in Drosophila, zebrafish and mouse. Here we report nanos3 GT in embryonic stem (ES) cells of the fish medaka as a lower vertebrate model organism. A vector was designed for GT via homologous recombination on the basis of positive-negative selection (PNS). The ES cell line MES1 after gene transfer and PNS produced 56 colonies that were expanded into ES cell sublines. Nine sublines were GT-positive by PCR genotyping, 4 of which were homologous recombinants as revealed by Southern blot. We show that one of the 4, A15, contains a precisely targeted nanos3 allele without any random events, demonstrating the GT feasibility in medaka ES cells. Importantly, A15 retained all features of undifferentiated ES cells, including stable self-renewal, an undifferentiated phenotype, pluripotency gene expression and differentiation during chimeric embryogenesis. These results provide first evidence that the GT procedure and genuine GT on a chromosomal locus such as nanos3 do not compromise pluripotency in ES cells of a lower vertebrate.