The constitutive tyrosine kinase activity of the BCR-ABL fusion protein plays a crucial role in the pathogenesis of chronic myeloid leukemia and promotes growth factor-independent survival of hematopoietic cells. In 32D cells, expression levels of retrovirally transduced BCR-ABL were positively correlated with the levels of the cell cycle regulator protein p21, and this upregulation of p21 expression depended on the kinase activity of BCR-ABL. To assess the role of p21 on BCR-ABL-positive hematopoietic cells, we compared proliferation and drug-induced apoptosis in bone marrow (BM) cells from wild-type and p21 knockout mice after retroviral transfer of the BCR-ABL fusion gene. As compared with wild-type cells, p21 knockout cells showed increased proliferation, suggesting that p21 acted as an attenuator of BCR-ABL-mediated cell proliferation. In marked contrast, deletion of p21 promoted apoptosis induction by imatinib and taxol in BCR-ABL-transformed BM cells. These findings demonstrate that p21 has a dual function in BCR-ABL-transformed murine BM cells: It attenuates the effects of two apparently opposed phenomena such as BCR-ABL-mediated cell proliferation and drug-induced apoptosis. This dual function of p21 calls for a cautious evaluation of the suitability of p21 as a secondary target in anticancer therapy.