To assess the role of the CALM-AF10 fusion gene in leukemic transformation in vivo, we generated transgenic mice that expressed a CALM-AF10 fusion gene. Depending on the transgenic line, at least 40% to 50% of the F(1) generation mice developed acute leukemia at a median age of 12 months. Leukemic mice typically had enlarged spleens, invasion of parenchymal organs with malignant cells, and tumors with myeloid markers such as myeloperoxidase, Mac1, and Gr1. Although most leukemias were acute myeloid leukemia, many showed lymphoid features, such as CD3 staining, or clonal Tcrb or Igh gene rearrangements. Mice were clinically healthy for the first 9 months of life and had normal peripheral blood hemograms but showed impaired thymocyte differentiation, manifested by decreased CD4(+)/CD8(+) cells and increased immature CD4(-)/CD8(-) cells in the thymus. Hematopoietic tissues from both clinically healthy and leukemic CALM-AF10 mice showed up-regulation of Hoxa cluster genes, suggesting a potential mechanism for the impaired differentiation. The long latency period and incomplete penetrance suggest that additional genetic events are needed to complement the CALM-AF10 transgene and complete the process of leukemic transformation.