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Background Recombination Activating Genes (RAG) mutated embryonic stem cells are (ES) cells which are unable to perform V (D) J recombination. These cells can be used for generation of immunodeficient mouse. Creating biallelic mutations by CRISPR/Cas9 genome editing has emerged as a powerful technique to generate site-specific mutations in different sequences. Objectives The main purposes of this study were to achieve complete knock-out of RAG1 gene by investigating the nature of mutations in mutant mESC and to generate RAG1 knock-out mESCs containing homozygous indels with the aim of creating desired and specific RAG-1 -/- mutant mouse in a shorter period of time. Materials and Methods Here, we first utilized CRISPR/Cas9 system to target RAG1/RAG2 genes in NIH3T3 cells to test the activity and efficiency of our CRISPR system. Then we used the system for targeting RAG1 gene in mouse embryonic stem cell (mESCs) to generate knock-out embryonic stem cells. This method combined with highly active single guide RNA (sgRNA) is an efficient way to produce new RAG1-knockout mESCs in the selected regions of early coding DNA sequence, approximately between nucleotide c. 512-c. 513 and nucleotide c. 725-c. 726 of RAG1 coding sequence that had not been targeted previously. Results CRISPR gene editing resulted in a multitude of engineered homozygous and compound heterozygous mutations, including both in-frame and out-of-frame indels in 92% of mES cell clones. Most of the mutations generated by CRISPR/Cas9 system were out-of-frame, resulting in a complete gene knockout. In addition, 59% of the mutant ES cell clones carried out-of-frame homozygous indel mutations. The RAG1-knockout mESC clones retained normal morphology and pluripotent gene expression. Conclusions Our study demonstrated that CRISPR/Cas9 system can efficiently create biallelic indels containing both homozygous and compound heterozygous RAG1 mutations in about 92% of the mutant mESC clones. The 59% of mutant ES cell clones carried out-of-frame homozygous indel mutations.