Blastic transformation of chronic myelogenous leukemia (CML) is characterized by the presence of nonrandom, secondary genetic abnormalities in the majority of Philadelphia¹ clones, and loss of p53 tumor suppressor gene function is a consistent finding in 25–30% of CML blast crisis patients. To test whether the functional loss of p53 plays a direct role in the transition of chronic phase to blast crisis, bone marrow cells from p53^+/+ or p53^−/− mice were infected with a retrovirus carrying either the wild-type BCR/ABL or the inactive kinase-deficient mutant, and were assessed for colony-forming ability. Infection of p53^−/− marrow cells with wild-type BCR/ABL, but not with the kinase-deficient mutant, enhanced formation of hematopoietic colonies and induced growth factor independence at high frequency, as compared with p53^+/+ marrow cells. These effects were suppressed when p53^−/− marrow cells were coinfected with BCR/ABL and wild-type p53. p53-deficient BCR/ABL-infected marrow cells had a proliferative advantage, as reflected by an increase in the fraction of S+G₂ phase cells and a decrease in the number of apoptotic cells. Immunophenotyping and morphological analysis revealed that BCR/ABL-positive p53^−/− cells were much less differentiated than their BCR/ABL-positive p53^+/+ counterparts. Injection of immunodeficient mice with BCR/ABL-positive p53^−/− cells produced a transplantable, highly aggressive, poorly differentiated acute myelogenous leukemia. In marked contrast, the disease process in mice injected with BCR/ABL-positive p53^+/+ marrow cells was characterized by cell infiltrates with a more differentiated phenotype and was significantly retarded, as indicated by a much longer survival of leukemic mice. Together, these findings directly demonstrate that loss of p53 function plays an important role in blast transformation in CML.