The zebrafish cloche (clo) mutation affects the earliest known step in differentiation of blood and endothelial cells in vertebrates. We established clo/gata1-GFP transgenic line with erythroid-specific GFP expression which allowed differentiation of clo and wild type siblings at the mid-somitogenesis stages before morphologically visible phenotypes appeared. To discover novel genes potentially involved in hematopoietic and vascular development, we performed microarray analysis of over 15,000 zebrafish genes or expressed sequence tags (ESTs) in clo mutant embryos. We isolated the full-length sequences and determined the expression patterns for eight novel cDNAs which were significantly downregulated in clo-/- embryos. Dual specificity phosphatase 5 (dusp5), cadherin 5 (cdh5; VE-cadherin), aquaporin 8 (aqp8), adrenomedullin receptor (admr), complement receptor C1qR-like (crl), scavenger receptor class F, member 1 (scarf1) and ETS1-like protein (etsrp) were specifically expressed in the vascular endothelial cells while retinol binding protein 4 (rbp4) was expressed in the yolk syncytial layer and the hypochord. Further functional studies of these novel genes should help to elucidate critical early steps leading to the formation of vertebrate blood vessels.