SETBP1 variants occur as somatic mutations in several hematological malignancies such as atypical chronic myeloid leukemia and as de novo germline mutations in the Schinzel-Giedion syndrome. Here we show that SETBP1 binds to gDNA in AT-rich promoter regions, causing activation of gene expression through recruitment of a HCF1/KMT2A/PHF8 epigenetic complex. Deletion of two AT-hooks abrogates the binding of SETBP1 to gDNA and impairs target gene upregulation. Genes controlled by SETBP1 such as MECOM are significantly upregulated in leukemias containing SETBP1 mutations. Gene ontology analysis of deregulated SETBP1 target genes indicates that they are also key controllers of visceral organ development and brain morphogenesis. In line with these findings, in utero brain electroporation of mutated SETBP1 causes impairment of mouse neurogenesis with a profound delay in neuronal migration. In summary, this work unveils a SETBP1 function that directly affects gene transcription and clarifies the mechanism operating in myeloid malignancies and in the Schinzel-Giedion syndrome caused by SETBP1 mutations.