The Runt family transcription factor CBFalpha2 (AML1, PEBP2alphaB, or Runx1) is required by hematopoietic stem cells and expressed at high levels in T-lineage cells. In human T cells CBFalpha2 is usually transcribed from a different promoter (distal promoter) than in myeloid cells (proximal promoter), but the developmental and functional significance of this promoter switch has not been known. Here, we report that both coding and noncoding sequences of the distal 5' end are highly conserved between the human and the murine genes, and the distal promoter is responsible for the overwhelming majority of CBFalpha2 expression in murine hematopoietic stem cells as well as in T cells. Distal promoter activity is maintained throughout T cell development and at lower levels in B cell development, but downregulated in natural killer cell development. The distal N-terminal isoform binds to functionally important regulatory sites from known target genes with two- to threefold higher affinity than the proximal N-terminal isoform. Neither full-length isoform alters growth of a myeloid cell line under nondifferentiating conditions, but the proximal isoform selectively delays mitotic arrest of the cell line under differentiating conditions, resulting in the generation of greater numbers of neutrophils.