Lenalidomide (Revlimid, CC-5013) belongs to a line of compounds known as immunomodulatory drugs (IMiDs) that are under clinical investigation in hematopoietic and solid tumor cancers. Lenalidomide efficacy has been reported in clinical trials of multiple myeloma and myelodysplastic syndromes (MDS), particularly in MDS patients with a del 5q cytogenetic abnormality, with or without other cytogenetic abnormalities. Here we report that lenalidomide inhibits proliferation of chromosome 5 deleted hematopoietic tumor cell lines in vitro, whether from the B cell, T cell, or myeloid lineage. There was diversity in the responses of the various cell lines to lenalidomide, with one undergoing cell cycle arrest, and others undergoing apoptosis. In the most lenalidomide-sensitive chromosome 5 deleted cell line, Namalwa CSN.70, the compound induced G0/G1 cell cycle arrest, inhibited Akt and Gab1 phosphorylation, and inhibited the ability of Gab1 to associate with a receptor tyrosine kinase. Lenalidomide also enhanced AP-1 transcriptional activity in Namalwa, but not in the other cell lines tested. These studies provide evidence for the mechanism of action of lenalidomide in chromosome 5 deleted hematopoietic tumors in vitro, and may provide a better understanding of the drug's activity in clinical applications.