The development of the hematopoietic system is a dynamic process that is controlled by the interplay between transcriptional and epigenetic networks to determine cellular identity. These networks are critical for lineage specification and are frequently dysregulated in leukemias. Here, we identified histone demethylase KDM2B as a critical regulator of definitive hematopoiesis and lineage commitment of murine hematopoietic stem and progenitor cells (HSPCs). RNA sequencing of Kdm2b-null HSPCs and genome-wide ChIP studies in human leukemias revealed that KDM2B cooperates with polycomb and trithorax complexes to regulate differentiation, lineage choice, cytokine signaling, and cell cycle. Furthermore, we demonstrated that KDM2B exhibits a dichotomous role in hematopoietic malignancies. Specifically, we determined that KDM2B maintains lymphoid leukemias, but restrains RAS-driven myeloid transformation. Our study reveals that KDM2B is an important mediator of hematopoietic cell development and has opposing roles in tumor progression that are dependent on cellular context.