The word transgenic refers to the translocation or relocation of genetic material i.e. genes. A past, practical example of this was the translocation of genes taken from a human and inserted in to the genome of a female sheep. This is a form of genetic engineering, which is a term used to describe the skills which have been developed enabling molecular biologists to move genes from one chromosome to another. Genetic engineering involves locating a desirable gene, isolating it and then inserting it in to the genome of another organism. The proteins produced in response to the new piece of DNA by the new host cell will either have a useful effect in the host cell or may be harvested for use elsewhere.

The techniques used in genetic engineering are complex. Special enzymes called restriction endonucleases or restriction enzymes chop up DNA strands, cutting them at very specific sites. Other enzymes known as DNA ligases act as "genetic glue" and join pieces of DNA together. The required fragment of DNA cut from the chromosome of one organism is pasted in to another piece of DNA which will carry it into the host cell. Plasmids, the circular strands of DNA found in bacteria, are frequently used as these vectors. Once the plasmid is incorporated in to the host nucleus it becomes part of the new recombinant DNA of the engineered genome.

These techniques have made possible the creation of new genomes resulting in the production of altered organisms such as Polly. Polly was the next step from Dolly the sheep; Dolly was the first cloned animal, Polly was cloned latter, but was also transgenically altered. This was the first breakthrough showing the combination of two very complex and powerful techniques.