The zebrafish (Danio rerio) is increasingly being used to study basic vertebrate 
biology and human disease with a rich array of in vivo genetic and molecular 
tools. However, the inability to readily modify the genome in a targeted fashion 
has been a bottleneck in the field. Here we show that improvements in artificial 
transcription activator-like effector nucleases (TALENs) provide a powerful new 
approach for targeted zebrafish genome editing and functional genomic 
applications. Using the GoldyTALEN modified scaffold and zebrafish delivery 
system, we show that this enhanced TALEN toolkit has a high efficiency in 
inducing locus-specific DNA breaks in somatic and germline tissues. At some 
loci, this efficacy approaches 100%, including biallelic conversion in somatic 
tissues that mimics phenotypes seen using morpholino-based targeted gene 
knockdowns. With this updated TALEN system, we successfully used single-stranded 
DNA oligonucleotides to precisely modify sequences at predefined locations in 
the zebrafish genome through homology-directed repair, including the 
introduction of a custom-designed EcoRV site and a modified loxP (mloxP) 
sequence into somatic tissue in vivo. We further show successful germline 
transmission of both EcoRV and mloxP engineered chromosomes. This combined 
approach offers the potential to model genetic variation as well as to generate 
targeted conditional alleles.