Creating transgenic mammals is currently a very inefficient process. In addition to problems with transgene integration and unpredictable expression patterns of the inserted gene, embryo loss occurs at various developmental stages. In the present study, we demonstrate that this loss is due to chromosomal damage. We examined the integrity of chromosomes in embryos produced by microinjection of pronuclei, intracytoplasmic sperm injection (ICSI), and in vitro fertilization (IVF)-mediated transgenesis, and correlated these findings with the abilities of embryos to develop in vitro and yield transgenic morulas/blastocysts. Chromosomal analysis was performed after microinjection of the pronuclei in zygotes, as well as in parthenogenetic and androgenetic embryos. In all the pronuclei injection groups, significant oocyte arrest and increased incidence of chromosome breaks were observed after both transgenic DNA injection and sham injection. This indicates that the DNA damage is a transgene-independent effect. In ICSI-mediated transgenesis, there was no significant oocyte arrest. The observed chromosomal damage was lower than that after pronuclei microinjection in zygotes and was dependent upon the presence of exogenous DNA. The occurrence of DNA breaks, as measured by comet assay performed on the sperm prior to ICSI, showed that DNA damage was present in the sperm before fertilization. Embryonic development in vitro and transgene expression at the morula/blastocyst stage were higher in ICSI-mediated transgenesis than after microinjection of pronuclei into zygotes. Sperm-mediated gene transfer via IVF did not affect chromosome integrity, allowed good embryo development, but did not yield any transgenic embryos. The present study demonstrates that DNA damage occurs after both the microinjection of pronuclei and ICSI-mediated transgenesis, albeit through different mechanisms.