Keeping a balance between DNA methylation and demethylation balance is central for mammalian development and cell function, particularly in the hematopoietic system. In various mammalian cells, Tet methylcytosine dioxygenase 2 (Tet2) catalyzes oxygen transfer to a methyl group of 5-methylcytosine (5mC), yielding 5-hydroxymethylcytocine (5hmC). Tet2 mutations drive tumorigenesis in several blood cancers as well as in solid cancers. Here I discuss recent studies that elucidate mechanisms and biological consequences of Tet2 dysregulation in blood cancers. I focus on recent findings concerning Tet2 involvement in lymphoid and myeloid cell development and its functional roles, which may be associated with tumorigenesis. I also discuss how Tet2 activities are modulated by microRNAs, metabolites, and other interactors, including vitamin C and 2-hydroxyglutarate (2-HG), and review the clinical relevance and potential therapeutic applications of Tet2 targeting. Finally, I propose key unanswered hypotheses regarding Tet2 in the cancer-immunity cycle.