MLL fusion proteins are leukemogenic, but their mechanism is unclear. Induced dimerization of a truncated MLL immortalizes bone marrow and imposes a reversible block on myeloid differentiation associated with upregulation of Hox a7, a9, and Meis1. Both dimerized MLL and exon-duplicated MLL are potent transcriptional activators, suggesting a link between dimerization and partial tandem duplication of DNA binding domains of MLL. Dimerized MLL binds with higher affinity than undimerized MLL to a CpG island within the Hox a9 locus. However, MLL-AF9 is not dimerized in vivo. The data support a model in which either MLL dimerization/exon duplication or fusion to a transcriptional activator results in Hox gene upregulation and ultimately transformation.