The pioneering research by the trio has allowed scientists both to discover the function of a gene and create of animal models of human disease.
Professor Sir Martin Evans of Cardiff University shares the 2007 Nobel Prize in Physiology or Medicine with a second UK scientist, Oliver Smithies, and the Italian Mario Capecchi "for their discoveries of principles for introducing specific gene modifications in mice by the use of embryonic stem cells".
The trio have been tipped to win the Nobel for several years after winning the 2001 Lasker Award for 'Basic Medical Research'.
These awards are also known as 'America's Nobels' and are one of the most coveted accolades in medical science.
There are literally dozens of examples of eminent researchers winning both during their careers.
Speaking in 2001, Ira Herskowitz, a professor of genetics at the University of California in San Francisco who presented the Lasker award, said: "Building on more than one hundred years of genetic and embryological studies of the mouse, [they] have created a magic wand by which it is possible to modify any mouse gene with exquisite precision - to completely delete it or to produce a specifically altered form of the gene."
This breakthrough, at long last, provided scientists with the ability to link a mammalian gene to its function.
This is particularly important since the sequencing of the human genome and also lets researchers restore the function of a defective gene.
Thanks to their work, scientists now know much more about mammalian physiology, for example how the human immune system works.
Not only that, but the ability to create mice with specific genes 'knocked out', has led to the creation of mice with versions of human diseases such as cycstic fibrosis, muscular dystrophy, atherosclerosis, and many others, explained Herskowitz.
These models can then be used to follow the course of a disease, which is crucial in discovering and testing new drugs.
"The ability to precisely tailor mouse genes has completely revolutionized the practice of biomedical science for the last decade and is likely to become even more important in the decades to come," she said.
During their work, Capecchi and Smithies found a way to target specific genes in cultured animal cells.
The problem was how to produce mice with the same characteristics.
Thanks to his work with Matt Kaufman, Evans provided the answer.
In 1981, Evans and Kaufman were the first to isolate ES cells - along with US scientist Gail Martin also achieved the same feat independently.
Evans found that if the ES cells were genetically manipulated, the changes would also be present in progeny mice.
The importance of this discovery was realised immediately by Smithies and Cepecchi, who set about learning how to grow the cells and then use them to carry targeted genetic mutations.