The use of transgenic markers in pluripotent stem cells allows the facile isolation of transient cell populations that appear at certain phases of embryonic development. Here, we describe a procedure for deriving cardiac progenitors from mouse pluripotent stem cells carrying a GFP reporter under the control of an Nkx2.5 enhancer sequence. The cells are propagated under standard conditions and are differentiated using the hanging-droplet method with medium optimized for commitment to the cardiac lineage. Cardiac progenitors are isolated from the differentiation culture using fluorescence-activated cell sorting (FACS) and can be cultured further for functional characterization and experimentation. The protocols described here can be applied to both embryonic and induced pluripotent stem cells and can easily be adapted to transgenic lines carrying other cardiac cell lineage reporters.