CCAAT/enhancer binding protein (C/EBP)α is a myeloid-specific transcription factor that couples lineage commitment to terminal differentiation and cell cycle arrest, and is found mutated in 9% of patients who have acute myeloid leukemia (AML). We previously showed that mutations which dissociate the ability of C/EBPα to block cell cycle progression through E2F inhibition from its function as a transcriptional activator impair the in vivo development of the neutrophil granulocyte and adipose lineages. We now show that such mutations increase the capacity of bone marrow (BM) myeloid progenitors to proliferate, and predispose mice to a granulocytic myeloproliferative disorder and transformation of the myeloid compartment of the BM. Both of these phenotypes were transplantable into lethally irradiated recipients. BM transformation was characterized by a block in granulocyte differentiation, accumulation of myeloblasts and promyelocytes, and expansion of myeloid progenitor populations—all characteristics of AML. Circulating myeloblasts and hepatic leukocyte infiltration were observed, but thrombocytopenia, anemia, and elevated leukocyte count—normally associated with AML—were absent. These results show that disrupting the cell cycle regulatory function of C/EBPα is sufficient to initiate AML-like transformation of the granulocytic lineage, but only partially the peripheral pathology of AML.