The proliferation and differentiation of adult stem cells is balanced to ensure adequate generation of differentiated cells, stem cell homeostasis, and guard against malignant transformation. CD48 is broadly expressed on hematopoietic cells but excluded from quiescent long-term murine HSCs. Through its interactions with CD244 on progenitor cells, it influences HSC function by altering the BM cytokine milieu, particularly IFNγ. In CD48-null mice, the resultant misregulation of cytokine signaling produces a more quiescent HSC, a disproportionate number of short-term progenitors, and hyperactivation of Pak1, leading to hematologic malignancies similar to those found in patients with X-linked lymphoproliferative disease. CD48 plays a vital role as an environmental sensor for regulating HSC and progenitor cell numbers and inhibiting tumor development.