To determine the possible role of the BCR/ABL oncoprotein SH3 domain in BCR/ABL-dependent leukemogenesis, we studied the biologic properties of a BCR/ABL SH3 deletion mutant (▵SH3 BCR/ABL) constitutively expressed in murine hematopoietic cells. ▵SH3 BCR/ABL was able to activate known BCR/ABL-dependent downstream effector molecules such as RAS, PI-3kinase, MAPK, JNK, MYC, JUN, STATs, and BCL-2. Moreover, expression of ▵SH3 BCR/ABL protected 32Dcl3 murine myeloid precursor cells from apoptosis, induced their growth factor-independent proliferation, and resulted in transformation of primary bone marrow cells in vitro. Unexpectedly, leukemic growth from cells expressing ▵SH3 BCR/ABL was significantly retarded in SCID mice compared with that of cells expressing the wild-type protein. In vitro and in vivo studies to determine the adhesive and invasive properties of ▵SH3 BCR/ABL-expressing cells showed their decreased interaction to collagen IV- and laminin-coated plates and their reduced capacity to invade the stroma and to seed the bone marrow and spleen. The decreased interaction with collagen type IV and laminin was consistent with a reduced expression of α2 integrin by ▵SH3 BCR/ABL-transfected 32Dcl3 cells. Moreover, as compared with wild-type BCR/ABL, which localizes primarily in the cytoskeletal/ membrane fraction, ▵SH3 BCR/ABL was more evenly distributed between the cytoskeleton/membrane and the cytosol compartments. Together, the data indicate that the SH3 domain of BCR/ABL is dispensable for in vitro transformation of hematopoietic cells but is essential for full leukemogenic potential in vivo.