Despite being an attractive molecular target for both lymphoid and myeloid leukemias characterized by activated tyrosine kinases, the molecular and physiological consequences of reduced signal transducer and activator of transcription-5 (Stat5) during leukemogenesis are not well known. Stat5 is a critical regulator of mouse hematopoietic stem cell (HSC) self-renewal and is essential for normal lymphocyte development. We report that pan-hematopoietic deletion in viable adult Vav1-Cre conditional knockout mice as well as Stat5abnull/null fetal liver transplant chimeras generated HSCs with reduced expression of quiescence regulating genes (Tie2, Mpl, Slamf1, Spi1, Cited2) and increased expression of B-cell development genes (Satb1, Dntt, Btla, Flk2). Using a classical murine B-cell acute lymphoblastic leukemia (B-ALL) model, we demonstrate that these HSCs were also poised to produce a burst of B-cell precursors upon expression of Bcl-2 combined with oncogenic Myc. This strong selective advantage for leukemic transformation in the background of Stat5 deficient hematopoiesis was permissive for faster initiation of Myc-induced transformation to B-ALL. However, once established, the B-ALL progression in secondary transplant recipients was Stat5-independent. Overall, these studies suggest that Stat5 can play multiple important roles that not only preserve the HSC compartment but can limit accumulation of potential pre-leukemic lymphoid populations.