Notch receptors regulate fate decisions in many cells. One outcome of Notch signaling is differentiation of bipotential precursors into one cell type versus another. To investigate consequences of Notch1 expression in hematolymphoid progenitors, mice were reconstituted with bone marrow (BM) transduced with retroviruses encoding a constitutively active form of Notch1. Although neither granulocyte or monocyte differentiation were appreciably affected, lymphopoiesis was dramatically altered. As early as 3 weeks following transplantation, mice receiving activated Notch1-transduced BM contained immature CD4+ CD8+ T cells in the BM and exhibited a simultaneous block in early B cell lymphopoiesis. These results suggest that Notch1 provides a key regulatory signal in determining T lymphoid versus B lymphoid lineage decisions, possibly by influencing lineage commitment from a common lymphoid progenitor cell.