Spermatogonial stem cells (SSCs) are the only stem cells in the body with germline potential, which makes them an attractive target for germline modification. We previously showed the feasibility of homologous recombination in mouse SSCs and produced knockout (KO) mice by exploiting germline stem (GS) cells, i.e., cultured spermatogonia with SSC activity. In this study, we report the successful homologous recombination in rat GS cells, which can be readily established by their ability to form germ cell colonies on culture plates whose surfaces are hydrophilic and neutrally charged and thus limit somatic cell binding. We established a drug selection protocol for GS cells under hypoxic conditions. The frequency of the homologous recombination of the Ocln gene was 4.2% (2 out of 48 clones). However, these GS cell lines failed to produce offspring following xenogeneic transplantation into mouse testes and microinsemination, suggesting that long-term culture and drug selection have a negative effect on GS cells. Nevertheless, our results demonstrate the feasibility of gene targeting in rat GS cells and pave the way toward the generation of KO rats.