The bone marrow microenvironment plays an important role in acute lymphoblastic leukemia (ALL) cell proliferation, maintenance, and resistance to chemotherapy. Annexin II (ANX2) is abundantly expressed on bone marrow cells and complexes with p11 to form ANX2/p11-hetero-tetramer (ANX2T). We present evidence that p11 is upregulated in refractory ALL cell lines and patient samples. A small molecule inhibitor that disrupts ANX2/p11 interaction (ANX2T inhibitor), an anti-ANX2 antibody, and knockdown of p11, abrogated ALL cell adhesion to osteoblasts, indicating that ANX2/p11 interaction facilitates binding and retention of ALL cells in the bone marrow. Furthermore, ANX2T inhibitor increased the sensitivity of primary ALL cells co-cultured with osteoblasts to dexamethasone and vincristine induced cell death. Finally, in an orthotopic leukemia xenograft mouse model, the number of ALL cells homing to the bone marrow was reduced by 40-50% in mice injected with anti-ANX2 antibody, anti-p11 antibody or ANX2T inhibitor compared to respective controls. In a long-term engraftment assay, the percentage of ALL cells in mouse blood, bone marrow and spleen was reduced in mice treated with agents that disrupt ANX2/p11 interaction. These data show that disruption of ANX2/p11 interaction results in reduced ALL cell adhesion to osteoblasts, increased ALL cell sensitization to chemotherapy, and suppression of ALL cell homing and engraftment.