Since its domestication over 100 years ago, the laboratory rat has been the preferred experimental animal in many areas of biomedical research (Lindsey and Baker The laboratory rat. Academic, New York, pp 1-52, 2006). Its physiology, size, genetics, reproductive cycle, cognitive and behavioural characteristics have made it a particularly useful animal model for studying many human disorders and diseases. Indeed, through selective breeding programmes numerous strains have been derived that are now the mainstay of research on hypertension, obesity and neurobiology (Okamoto and Aoki Jpn Circ J 27:282-293, 1963; Zucker and Zucker J Hered 52(6):275-278, 1961). Despite this wealth of genetic and phenotypic diversity, the ability to manipulate and interrogate the genetic basis of existing phenotypes in rat strains and the methodology to generate new rat models has lagged significantly behind the advances made with its close cousin, the laboratory mouse. However, recent technical developments in stem cell biology and genetic engineering have again brought the rat to the forefront of biomedical studies and enabled researchers to exploit the increasingly accessible wealth of genome sequence information. In this review, we will describe how a breakthrough in understanding the molecular basis of self-renewal of the pluripotent founder cells of the mammalian embryo, embryonic stem (ES) cells, enabled the derivation of rat ES cells and their application in transgenesis. We will also describe the remarkable progress that has been made in the development of gene editing enzymes that enable the generation of transgenic rats directly through targeted genetic modifications in the genomes of zygotes. The simplicity, efficiency and cost-effectiveness of the CRISPR/Cas gene editing system, in particular, mean that the ability to engineer the rat genome is no longer a limiting factor. The selection of suitable targets and gene modifications will now become a priority: a challenge where ES culture and gene editing technologies can play complementary roles in generating accurate bespoke rat models for studying biological processes and modelling human disease.