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Embryonic stem (ES) cells are promising for cardiac repair, but directing their differentiation toward cardiomyocytes remains challenging. We investigated whether the heart guides ES cells toward cardiomyocytes in vivo and whether allogeneic ES cells were immunologically tolerated. Undifferentiated mouse ES cells consistently formed cardiac teratomas in nude or immunocompetent syngeneic mice. Cardiac teratomas contained no more cardiomyocytes than hind-limb teratomas, suggesting lack of guided differentiation. ES cells also formed teratomas in infarcted hearts, indicating injury-related signals did not direct cardiac differentiation. Allogeneic ES cells also caused cardiac teratomas, but these were immunologically rejected after several weeks, in association with increased inflammation and up-regulation of class I and II histocompatibility antigens. Fusion between ES cells and cardiomyocytes occurred in vivo, but was rare. Infarct autofluorescence was identified as an artifact that might be mistaken for enhanced GFP expression and true regeneration. Hence, undifferentiated ES cells were not guided toward a cardiomyocyte fate in either normal or infarcted hearts, and there was no evidence for allogeneic immune tolerance of ES cell derivatives. Successful cardiac repair strategies involving ES cells will need to control cardiac differentiation, avoid introducing undifferentiated cells, and will likely require immune modulation to avoid rejection.