MLL, involved in many chromosomal translocations associated with acute myeloid and lymphoid leukemia, has >50 known partner genes with which it is able to form in-frame fusions. Characterizing important downstream target genes of MLL and of MLL fusion proteins may provide rational therapeutic strategies for the treatment of MLL-associated leukemia. We explored downstream target genes of the most prevalent MLL fusion protein, MLL-AF4. To this end, we developed inducible MLL-AF4 fusion cell lines in different backgrounds. Overexpression of MLL-AF4 does not lead to increased proliferation in either cell line, but rather, cell growth was slowed compared with similar cell lines inducibly expressing truncated MLL. We found that in the MLL-AF4-induced cell lines, the expression of the cyclin-dependent kinase inhibitor gene CDKN1B was dramatically changed at both the RNA and protein (p27kip1) levels. In contrast, the expression levels of CDKN1A (p21) and CDKN2A (p16) were unchanged. To explore whether CDKN1B might be a direct target of MLL and of MLL-AF4, we used chromatin immunoprecipitation (ChIP) assays and luciferase reporter gene assays. MLL-AF4 binds to the CDKN1B promoter in vivo and regulates CDKN1B promoter activity. Further, we confirmed CDKN1B promoter binding by ChIP in MLL-AF4 as well as in MLL-AF9 leukemia cell lines. Our results suggest that CDKN1B is a downstream target of MLL and of MLL-AF4, and that, depending on the background cell type, MLL-AF4 inhibits or activates CDKN1B expression. This finding may have implications in terms of leukemia stem cell resistance to chemotherapy in MLL-AF4 leukemias.