The signal transducer and activator of transcription 5 (STAT5) regulates differentiation, survival, proliferation and transformation of hematopoietic cells. Upon cytokine stimulation, STAT5 tyrosine phosphorylation (pYSTAT5) is transient, while in diverse neoplastic cells persistent overexpression and enhanced pYSTAT5 are frequently found. Post-translational modifications might contribute to enhanced STAT5 activation in the context of transformation, but the strength and duration of pYSTAT5 are incompletely understood. We found that O-GlcNAcylation and tyrosine phosphorylation act together to trigger pYSTAT5 levels and oncogenic transcription in neoplastic cells. The expression of a mutated hyperactive gain-of-function (GOF) STAT5 without O-GlcNAcylation resulted in decreased tyrosine phosphorylation, oligomerization and transactivation potential and complete loss of oncogenic transformation capacity. The lack of O-GlcNAcylation diminished phospho-ERK and phospho-AKT levels. Our data show that O-GlcNAcylation of STAT5 is an important process that contributes to oncogenic transcription through enhanced STAT5 tyrosine phosphorylation and oligomerization driving myeloid transformation. O-GlcNAcylation of STAT5 could be required for nutrient sensing and metabolism of cancer cells.