Regulated gene rearrangement is thought to underlie allelic exclusion, the observation that an individual B cell expresses only a single immunoglobulin molecule. Previous data has implicated transcriptional activation of rearranging loci in the regulation of their accessibility to the V(D)J recombinase. Using homologous recombination in ES cells, we have generated “knockin” mice which express a GFP cDNA from an unrearranged immunoglobulin κ light-chain allele. Surprisingly, we find that only a small fraction of κ alleles are highly transcribed in a population of pre-B cells, that such transcription is monoallelic, and that these highly transcribed alleles account for the vast majority of κ light-chain gene rearrangement. These data lead us to suggest that probabilistic enhancer activation and allelic competition are part of the mechanism of κ locus allelic exclusion and may be a general mechanism contributing to cellular differentiation during development.