Acute promyelocytic leukemia (APL) is always associated with chromosomal translocations that disrupt the retinoic acid receptor alpha (RARalpha) gene. Whether these translocations relate to a role for endogenous RARalpha in normal granulopoiesis remains uncertain because most studies addressing this question have used non-physiological overexpression systems. Granulocyte differentiation in cells derived from RARalpha-deficient (RARalpha(-/-)) mice was studied and evaluated in the context of agonist-bound and ligand-free RARalpha. Our results demonstrate that RARalpha is dispensable for granulopoiesis, as RARalpha(-/-) mice have a normal granulocyte population despite an impaired ability to respond to retinoids. However, although it is not absolutely required, RARalpha can bidirectionally modulate granulopoiesis. RARalpha stimulates differentiation in response to exogenous retinoic acid. Furthermore, endogenous retinoids control granulopoiesis in vivo, as either vitamin A-deficient mice or animals treated with an RAR antagonist accumulate more immature granulocytes in their bone marrow. Conversely, RARalpha acts to limit differentiation in the absence of ligand because granulocyte precursors from RARalpha(-/-) mice differentiate earlier in culture. Thus, the block in granulopoiesis exerted by RARalpha fusion proteins expressed in APL cells may correspond to an amplification of a normal function of unliganded RARalpha.