Myeloid leukemia factor 1 (MLF1) is a novel oncoprotein involved in translocations associated with acute myeloid leukemia (AML), especially erythroleukemias. In this study, we demonstrate that ectopic expression of Mlf1 prevented J2E erythroleukemic cells from undergoing biological and morphological maturation in response to erythropoietin (Epo). We show that Mlf1 inhibited Epo-induced cell cycle exit and suppressed a rise in the cell cycle inhibitor p27(Kip1). Unlike differentiating J2E cells, Mlf1-expressing cells did not downregulate Cul1 and Skp2, components of the ubiquitin E3 ligase complex SCF(Skp2) involved in the proteasomal degradation of p27(Kip1). In contrast, Mlf1 did not interfere with increases in p27(Kip1) and terminal differentiation initiated by thyroid hormone withdrawal from erythroid cells, or cytokine-stimulated maturation of myeloid cells. These data demonstrate that Mlf1 interferes with an Epo-responsive pathway involving p27(Kip1) accumulation, which inhibits cell cycle arrest essential for erythroid terminal differentiation.