Induced pluripotent stem cells (iPSCs) are derived from somatic cells through a reprogramming process, which converts them to a pluripotent state, akin to that of embryonic stem cells. Over the past decade, iPSC models have found increasing applications in the study of human diseases, with blood disorders featuring prominently. Here, we discuss methodological aspects pertaining to iPSC generation, hematopoietic differentiation and gene editing, and provide an overview of uses of iPSCs in modeling the cell and gene therapy of inherited genetic blood disorders, as well as their more recent use as models of myeloid malignancies. We also discuss the strengths and limitations of iPSCs compared to model organisms and other cellular systems commonly used in hematology research.