Assessing the functional significance of novel putative oncogenes remains a significant challenge given the limitations of current loss-of-function tools. Here, we describe a method that employs TALEN or CRISPR/Cas9-mediated knock-in of inducible degron tags (Degron-KI) that provides a versatile approach for the functional characterization of novel cancer genes and addresses many of the shortcomings of current tools. The Degron-KI system allows for highly specific, inducible, and allele-targeted inhibition of endogenous protein function, and the ability to titrate protein depletion with this system is able to better mimic pharmacologic inhibition compared with RNAi or genetic knockout approaches. The Degron-KI system was able to faithfully recapitulate the effects of pharmacologic EZH2 and PI3Kα inhibitors in cancer cell lines. The application of this system to the study of a poorly understood putative oncogene, SF3B1, provided the first causal link between SF3B1 hotspot mutations and splicing alterations. Surprisingly, we found that SF3B1-mutant cells are not dependent upon the mutated allele for in vitro growth, but instead depend upon the function of the remaining wild-type alleles. Collectively, these results demonstrate the broad utility of the Degron-KI system for the functional characterization of cancer genes. Cancer Res; 75(10); 1949–58. ©2015 AACR.