De-ubiquitinating enzyme BAP1 is mutated in a hereditary cancer syndrome with increased risk of mesothelioma and uveal melanoma. Somatic BAP1 mutations occur in various malignancies. We show that mouse Bap1 gene deletion is lethal during embryogenesis, but systemic or hematopoietic-restricted deletion in adults recapitulates features of human myelodysplastic syndrome (MDS). Knockin mice expressing BAP1 with a 3xFlag tag revealed that BAP1 interacts with host cell factor–1 (HCF-1), O-linked N-acetylglucosamine transferase (OGT), and the polycomb group proteins ASXL1 and ASXL2 in vivo. OGT and HCF-1 levels were decreased by Bap1 deletion, indicating a critical role for BAP1 in stabilizing these epigenetic regulators. Human ASXL1 is mutated frequently in chronic myelomonocytic leukemia (CMML) so an ASXL/BAP1 complex may suppress CMML. A BAP1 catalytic mutation found in a MDS patient implies that BAP1 loss of function has similar consequences in mice and humans.