Chromosomal translocation is a common cause of leukaemia and the most common chromosome translocations found in leukaemia patients involve the mixed lineage leukaemia (MLL) gene. AF10 is one of more than 30 MLL fusion partners in leukaemia. We have recently demonstrated that the H3K79 methyltransferase hDOT1L contributes to MLL-AF10-mediated leukaemogenesis through its interaction with AF10 (ref. 5). In addition to MLL, AF10 has also been reported to fuse to CALM (clathrin-assembly protein-like lymphoid-myeloid) in patients with T-cell acute lymphoblastic leukaemia (T-ALL) and acute myeloid leukaemia (AML). Here, we analysed the molecular mechanism of leukaemogenesis by CALM-AF10. We demonstrate that CALM-AF10 fusion is both necessary and sufficient for leukaemic transformation. Additionally, we provide evidence that hDOT1L has an important role in the transformation process. hDOT1L contributes to CALM-AF10-mediated leukaemic transformation by preventing nuclear export of CALM-AF10 and by upregulating the Hoxa5 gene through H3K79 methylation. Thus, our study establishes CALM-AF10 fusion as a cause of leukaemia and reveals that mistargeting of hDOT1L and upregulation of Hoxa5 through H3K79 methylation is the underlying mechanism behind leukaemia caused by CALM-AF10 fusion.