Practically all studies of gene expression in humans to date have been performed in a relatively small number of adult tissues. Gene regulation is highly dynamic and context-dependent. In order to better understand the connection between gene regulation and complex phenotypes, including disease, we need to be able to study gene expression in more cell types, tissues, and states that are relevant to human phenotypes. In particular, we need to characterize gene expression in early development cell types, as mutations that affect developmental processes may be of particular relevance to complex traits. To address this challenge, we propose to use embryoid bodies (EBs), which are organoids that contain a multitude of cell types in dynamic states. EBs provide a system in which one can study dynamic regulatory processes at an unprecedentedly high resolution. To explore the utility of EBs, we systematically explored cellular and gene expression heterogeneity in EBs from multiple individuals. We characterized the various cell types that arise from EBs, the extent to which they recapitulate gene expression in vivo, and the relative contribution of technical and biological factors to variability in gene expression, cell composition, and differentiation efficiency. Our results highlight the utility of EBs as a new model system for mapping dynamic inter-individual regulatory differences in a large variety of cell types.