The frequency of poor outcomes in relapsed leukemia patients underscores the need for novel therapeutic approaches. The Food and Drug Administration-approved immunosuppressant FTY720 limits leukemia progression by activating protein phosphatase 2A and restricting nutrient access. Unfortunately, FTY720 cannot be re-purposed for use in cancer patients due to on-target toxicity associated with S1P receptor activation at the elevated, anti-neoplastic dose. Here we show that the constrained azacyclic FTY720 analog SH-RF-177 lacks S1P receptor activity but maintains anti-leukemic activity in vitro and in vivo. SH-RF-177 was not only more potent than FTY720, but killed via a distinct mechanism. Phosphorylation is dispensable for FTY720's anti-leukemic actions. However, chemical biology and genetic approaches demonstrated that the sphingosine kinase 2 (SPHK2)-mediated phosphorylation of SH-RF-177 led to engagement of a pro-apoptotic target and increased potency. The cytotoxicity of membrane-permeant FTY720 phosphonate esters suggests that the enhanced potency of SH-RF-177 stems from its more efficient phosphorylation. The tight inverse correlation between SH-RF-177 IC50 and SPHK2 mRNA expression suggests a useful biomarker for SH-RF-177 sensitivity. In summary, these studies indicate that FTY720 analogs that are efficiently phosphorylated but fail to activate S1P receptors may be superior anti-leukemic agents compared to compounds that avoid cardiotoxicity by eliminating phosphorylation.