This disclosure provides a system for creating cloned cells and embryos that are genetically modified. Cells are treated to increase expression of telomerase and potentially extend replicative capacity. One or more genetic modifications is made to inactivate a gene or confer desirable features, growing and selecting the cells as needed. The modified nucleus can then be transferred to a suitable recipient cell, which can then be used to grow an embryo with the conferred attributes. This technology makes it possible to create embryos, animals and embryonic cell lines with multiple genetic modifications, including homozygously inactivated genes and gene substitutions.