Hemopoietic lineage switching occurs when leukemic cells, apparently committed to one lineage, change and display the phenotype of another pathway. cDNA representational difference analysis was used to identify myeloid-specific genes that may be associated with an erythroid to myeloid lineage switch involving the murine J2E erythroleukemic cell line. One of the genes isolated (HLS7) is homologous to the novel human oncogene myeloid leukemia factor 1 (MLF1) involved in the t(3;5)(q25.1;q34) translocation associated with acute myeloid leukemia. Enforced expression of HLS7 in J2E cells induced a monoblastoid phenotype, thereby recapitulating the spontaneous erythroid to myeloid lineage switch. HLS7 also inhibited erythropoietin- or chemically-induced differentiation of erythroleukemic cell lines and suppressed development of erythropoietin-responsive colonies in semi-solid culture. However, intracellular signaling activated by erythropoietin was not impeded by ectopic expression of HLS7. In contrast, HLS7 promoted maturation of M1 monoblastoid cells and increased myeloid colony formation in vitro. These data show that HLS7 can influence erythroid/myeloid lineage switching and the development of normal hemopoietic cells.