The Iroquois homeodomain transcription factor gene IRX3 is expressed in the developing nervous system, limb buds, and heart, and transcript levels specify obesity risk in humans. We now report a functional role for IRX3 in human acute leukemia. Although transcript levels are very low in normal human bone marrow cells, high IRX3 expression is found in ∼30% of patients with acute myeloid leukemia (AML), ∼50% with T-acute lymphoblastic leukemia, and ∼20% with B-acute lymphoblastic leukemia, frequently in association with high-level HOXA gene expression. Expression of IRX3 alone was sufficient to immortalize hematopoietic stem and progenitor cells (HSPCs) in myeloid culture and induce lymphoid leukemias in vivo. IRX3 knockdown induced terminal differentiation of AML cells. Combined IRX3 and Hoxa9 expression in murine HSPCs impeded normal T-progenitor differentiation in lymphoid culture and substantially enhanced the morphologic and phenotypic differentiation block of AML in myeloid leukemia transplantation experiments through suppression of a terminal myelomonocytic program. Likewise, in cases of primary human AML, high IRX3 expression is strongly associated with reduced myelomonocytic differentiation. Thus, tissue-inappropriate derepression of IRX3 contributes significantly to the block in differentiation, which is the pathognomonic feature of human acute leukemias.