CCAAT enhancer binding protein-α (C/EBPα) inhibits proliferation in multiple cell types; therefore, we evaluated whether C/EBPα-deficient hematopoietic progenitor cells (HPCs) have an increased proliferative potential in vitro and in vivo. In this study we demonstrate that C/EBPα^-/- fetal liver (FL) progenitors are hyperproliferative, show decreased differentiation potential, and show increased self-renewal capacity in response to hematopoietic growth factors (HGFs). There are fewer committed bipotential progenitors in C/EBPα^-/- FL, whereas multipotential progenitors are unaffected. HGF-dependent progenitor cell lines can be derived by directly culturing C/EBPα^-/- FL cells in vitro Hyperproliferative spleen colonies and myelodysplastic syndrome (MDS) are observed in mice reconstituted with C/EBPα^-/- FL cells, indicating progenitor hyperproliferation in vitro and in vivo. C/EBPα^-/- FL lacked macrophage progenitors in vitro and had impaired ability to generate macrophages in vivo. These findings show that C/EBPα deficiency results in hyperproliferation of HPCs and a block in the ability of multipotential progenitors to differentiate into bipotential granulocyte/macrophage progenitors and their progeny. (Blood. 2004; 104:1639-1647)