LMO2, a member of the LIM-only protein family, is essential for the regulation of hematopoietic stem cells and formation of erythroid cells. It is found in a transcriptional complex comprising LMO2, TAL1, E47, GATA-1, and LDB1 which regulates erythroid genes. While TAL1 has been shown to induce erythroid differentiation, LMO2 appears to suppress fetal erythropoiesis. In addition to LMO2, the closely related LMO4 gene is expressed in hematopoietic cells, but has unknown functions. Here we demonstrate that LMO2 and LMO4 are expressed at the same level in erythroid colonies from mouse bone marrow, implying a function in erythroid differentiation. However, while LMO2 induced erythroid differentiation, LMO4 had no such effect. Interestingly, both LMO2 and TAL1 were able to partially suppress myeloid differentiation, implying that they activate erythroid differentiation in uncommitted bone marrow progenitors. Both LMO2 and LMO4 interacted strongly to LDB1, which was required for their localization to the nucleus. (C) 2007 Elsevier Inc. All rights reserved.