The t(3;5) in myelodysplastic syndrome (MDS) and acute myeloid leukemia (AML) creates a fusion product in which the amino-terminus of nucleophosmin (NPM), a nucleolar shuttle protein, is linked to the novel protein myelodysplasia/myeloid leukemia factor 1 (MLF1). The NPM portion of NPM-MLF1 contains an oligomerization motif that mediates self- association, association with normal NPM, and nuclear targeting; the importance of these (and other) NPM functions in NPM-MLF1-mediated MDS and AML is unknown. The normally cytoplasmic MLF1 protein, which lacks recognized functional motifs, is expressed in some leukemic cell lines but not in t(3;5)- positive cells; the role of MLF1 in normal hematopoiesis has not been determined. NPM-MLF1 can inhibit the G-CSF- mediated survival and, hence, the differentiation of myeloid precursor cells in a manner consistent with the proposed pathogenesis of MDS; MDS progression to AML probably requires additional mutations that cooperate with NPM-MLF1. To understand how NPM-MLF1 contributes to the genesis of MDS and AML, the funtionally -critical motifs in the NPM and MLF1 portions of the fusion that mediate its ability to block myeloid cell survival/differentiation will first be identified. Next, the hypothesis that NPM-MLF1 interferes with hematopoietic development to produce MDS and AML will be tested in mice programmed to express the fusion; as a corollary, the necessity for cooperating mutations in the induction AML by NPM-MLF1 will be determined and, if required, the involved genes will be identified. Finally, the role of MLF1 in normal growth and development will be defined to better understand how its alteration produces MDS and AML by determining the Mlf1 expression pattern in fetal and adult mice, by targeted disruption of the gene, and by assessing the effects of Mlf1 absence, or its aberrant expression, on hematopoietic differentiation of ES cells in vitro. These studies should yield valuable insight into the regulatory pathways disrupted by NPM-MLF1 in myelodysplastic (preleukemic) cells, and perhaps into the pathobiology of AML in general.