NUP98-HOXA9, the chimeric protein resulting from the t(7;11)(p15;p15) chromosomal translocation, is a prototype of several NUP98 fusions that occur in myelodysplastic syndromes and acute myeloid leukemia. We examined its effect on differentiation, proliferation, and gene expression in primary human CD34+ hematopoietic cells. Colony-forming cell (CFC) assays in semisolid medium combined with morphologic examination and flow cytometric immunophenotyping revealed that NUP98-HOXA9 increased the numbers of erythroid precursors and impaired both myeloid and erythroid differentiation. In continuous liquid culture, cells transduced with NUP98-HOXA9 exhibited a biphasic growth curve with initial growth inhibition followed by enhanced long-term proliferation, suggesting an increase in the numbers of primitive self-renewing cells. This was confirmed by a dramatic increase in the numbers of long-term culture-initiating cells, the most primitive hematopoietic cells detectable in vitro. To understand the molecular mechanisms underlying the effects of NUP98-HOXA9 on hematopoietic cell proliferation and differentiation, oligonucleotide microarray analysis was done at several time points over 16 days, starting at 6 hours posttransduction. The early growth suppression was preceded by up-regulation of IFNbeta1 and accompanied by marked up-regulation of IFN-induced genes, peaking at 3 days posttransduction. In contrast, oncogenes such as homeobox transcription factors, FLT3, KIT, and WT1 peaked at 8 days or beyond, coinciding with increased proliferation. In addition, several putative tumor suppressors and genes associated with hematopoietic differentiation were repressed at later time points. These findings provide a comprehensive picture of the changes in proliferation, differentiation, and global gene expression that underlie the leukemic transformation of human hematopoietic cells by NUP98-HOXA9.