Model species
Biologists use a number of model organisms to investigate biological phenomena. Some of the more famous and useful are:
Vertebrates
Vertebrates are useful model organisms, because they are relatively closely related to us, and hence what happens in a mouse in terms of physiology, etc., is similar to that which happens in a human being. However, there are clear ethical problems with using vertebrates (and indeed all animals) in experiments, since to varying degrees they are able to suffer fear, pain and trauma when used in scientific studies.
Humans (Homo sapiens)
Studying humans has obvious advantages and disadvantages: research is directly applicable, but the ethical implications of controlled medical trials are somewhat fraught. The complete human genome is now available. Chimpanzees (Pan troglodytes) and the other great apes are also closely related to us, and are another obvious moral minefield. Theoretically less of a minefield are cell lines derived from human beings: the cervical cancer cells of Henrietta Lacks (HeLa cells) can now be found in almost every lab working on human cells, although the circumstances of their genesis are ethically highly dubious.
Mouse (Mus musculus)
Mice are quick breeders, and are very similar to humans in their biochemistry and physiology. Their complete genome has recently become available. Mice, rats (Rattus norvegicus) and other rodents are used for the vast majority of medical experiments: dogs (Canis lupus familiaris) and cats (Felis silvestris catus) are much more rarely used than some antivivisectionists might like you to believe.
Pig (Sus scrofa)
Pigs are used in some medical research, and are described as 'horizontal humans' because their organs are of similar sizes to our own. I get somewhat annoyed by those who object to medical research on pigs yet still eat pork.
Clawed toad (Xenopus laevis)
Easy to keep, with very large and easy to manipulate eggs. A mainstay of embryological research, this toad unfortunately has a enormous genome even more polluted with junk DNA than ours. Its genome sequence is not likely to be forthcoming any time soon.
Zebra fish (Danio rerio)
Zebra fish have the charming advantage of coming in transparent varieties. They are used in water pollution tests to determine the probable effect of toxins on aquatic life.
Invertebrates
Invertebrates have the advantages of being smaller and easier to handle than vertebrate models organisms, and there are fewer ethical problems experimenting on nematodes than on chimpanzees.
Fruit fly (Drosophila melanogaster)
The fruit fly's genome is available, and fruit flies are extremely easy to breed in enormous numbers. You can quite easily set up you own colony by leaving some bananas and orange segments out in the sun for a few days. The salivary glands in the maggots of these flies have giant polytene chromosomes which allow the study of individual gene expression.
Roundworm (Caenorhabditis elegans)
Caenorhabditis has the honour of being the best understood multicellular organism on Earth. Not only is its genome available, so is the entirity of its embryology: we know when and were every cell in its body came from, all the way back to the egg. It also has the best studied vulva of any animal (it's a cell signalling thing, not a pervy thing).
Plants
Plants are economically important, and easy to study. Theoretically, there is no ethical minefield to traverse here (unless you're a fruitarian), although current discussions of genetically modified crops are changing that.
Thale cress (Arabidopsis thaliana)
This tiny cress has very few chromosomes, a completely sequenced genome and is often called the botanist's fruitfly. Most research on gene expression in plants is done in this organism.
Maize (Zea mays)
Maize has the advantage of being both an important crop species, and also having an extremely convenient mechanism for doing some sorts of genetics: you just count the colours and shapes of the kernels on a cob. Rice (Oryza sativa) and wheat (Triticum aestivum) are similarly useful.
Microorganisms
Even easier to grow than plants, the vast majority of all biological research is carried out in microorganisms, such as yeasts and bacteria.
Brewers' yeast (Saccharomyces cerevisiae)
One of the simplest eukaryotic single-celled organisms, yeast is also economically very important, in brewing and baking. Other economically important fungi include Penicillium notatum, the source of penicillin, and Aspergillus niger, the source of most commercial citric acid. Neurospora crass is another mainstay of genetic research, as it has conveniently ordered meiotic products in its asci.
Fission yeast (Schizosaccharomyces pombe)
Similar to brewers' yeast, but with reproduction by fission rather than budding. A mainstay of cell cycle research.
E. coli (Escherichia coli)
The best understood bacterium, inhabitant of the human gut, and occasional pathogen. Also used for the manipulation of genes from all and sundry other organisms. Pseudomonas spp. are similarly well understood Gram negative bacteria.

Bacillus subtilis. You can see endospores: the round bits in
the middle of some of the cells. These are highly resistant
structures, and can withstand radiation, UV light, and boiling at
120°C for 15 minutes.
A Gram positive bacterium that is also a spore-former, demonstrating that it's not just eukaryotes that do complex cellular differentiation. Closely related to the causative agent of anthrax (Bacillus anthracis).
Phage lambda (φλ)
An E. coli virus. Greater fleas have little fleas upon their backs to bite them, and little fleas have lesser fleas and so on ad infinitum. Phage lambda and its descendents are widely used in molecular biology.
HIV (Human immunodeficiency virus)
An unusual virus replicating via RNA. This was the first human retrovirus to be well characterised.
SV40 (Simian virus 40)
A well known oncovirus (cancer-causing virus), much studied in the realm of DNA replication.
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