SummaryTo discover small molecules that modulate hematopoietic cell homing after adoptive transfer, we created a transgenic zebrafish expressing firefly luciferase downstream of the ubiquitin promoter (ubi:luc) to serve as a hematopoietic donor. Bioluminescence imaging (BLI) was used to detect and follow ubi:luc hematopoietic cells that homed to the marrow as early as 1 day post-transplant. BLI was able to detect the biological effect of prostaglandin E2 on early homing/engraftment of donor hematopoietic cells. This system was utilized in a functional screen of small molecules to enhance homing/engraftment. We discovered a phytosterol, ergosterol, that could increase hematopoietic cell homing in zebrafish and mice. In addition, ergosterol increased CXCR4 expression and promoted expansion of Lin−SCA-1+KIT+ cells in vitro. We have demonstrated the utility of in vivo BLI to non-invasively monitor donor hematopoietic cell activity in adult zebrafish as a functional screen for mediators of cellular homing.