Retroviral oncogenes encode nuclear regulators of gene expression or signal transduction molecules, such as protein kinases, which stimulate the activity of cellular transcription factors. Here we describe the cloning of NF-M, a myeloid-specific transcription factor related to C/EBP beta, which is a target of activated protein kinases. NF-M stimulates the expression of the gene encoding cMGF, a myeloid cell-specific growth factor, creating an autocrine growth loop crucial to oncogene transformation of myeloid cells. The NF-M protein bound directly to the cMGF gene promoter and activated its transcription, even in erythroid cells where the promoter is usually inactive. In addition, a truncated, dominant-negative form of NF-M inhibited cMGF expression in macrophages, indicating that NF-M is required for the normal activation of the gene. When multipotent hematopoietic progenitor cells were stimulated to differentiate, NF-M expression was induced at a very early stage, suggesting that the transcription factor plays a role in lineage commitment. The stimulation of transformed myelomonocytic cells or of normal peripheral blood macrophages with kinases or LPS or TPA respectively, led to the rapid redistribution of NF-M protein from the cell bodies to the nucleus, consistent with the notion that NF-M was directly affected by such treatments. Our data indicate that NF-M plays a key role in myelomonocytic differentiation, in signal transduction during macrophage activation and in the development of myelogenous leukemia.