Msi1 (Musashi 1) is regarded as a marker for neural and intestinal epithelial stem cells. However, it is still unclear whether Msi1-positive cells derived from mouse embryonic stem cells have the ability to differentiate into neural or intestinal epithelial cells. A pMsi1–GFP (green fluorescent protein) reporter plasmid was constructed in order to sort Msi1-positive cells out of the differentiated cell population. The GFP-positive cells (i.e. Msi1-positive cells) were sorted by FACS and were hypodermically engrafted into the backs of NOD/SCID (non-obese diabetic/severe combined immunodeficient) mice. The presence of neural and intestinal epithelial cells in the grafts was detected. Msi1 was highly expressed in the GFP-positive cells, but not in the GFP-negative cells. The markers for neural cells (Nestin and Tubulin β III) and intestinal epithelial cells [FABP2 (fatty acid binding protein 2), Lyz (lysozyme) and ChA (chromogranin A)] were more highly expressed in the grafts from Msi1-positive cells than those from Msi1-negative cells (P<0.05). The grafts from the Msi1-negative cells contained more mesodermal-like tissues than those from the Msi1-positive cells. The pMsi1–GFP vector can be used to sort Msi1-positive cells from a cell population derived from mouse embryonic stem cells. The Msi1-positive cells can differentiate into neural and intestinal epithelial-like cells in vivo.