The bone marrow microenvironment supports and regulates the proliferation and differentiation of hematopoietic cells. Dysregulated hematopoiesis in chronic myelogenous leukemia (CML) is caused, at least in part, by abnormalities in CWL hematopoietic progenitors leading to altered interactions with the marrow microenvironment. The role of the microenvironment itself in CML has not been well characterized. We examined the capacity of CML stroma to support the growth of long-term culture- initiating cells (LTC-IC) obtained from normal and CML marrow. The growth of normal LTC-IC on CML stroma was significantly reduced compared with normal stroma. This did not appear to be related to abnormal production of soluble factors by CML stroma because normal LTC-IC grew equally well in Transwells above CML stroma as in Transwells above normal stroma. In addition, CML and normal stromal supernatants contained similar quantities of both growth- stimulatory (granulocyte colony-stimulating factor (CSF), interleukin-6, stem cell factor, granulocyte-macrophage CSF, and interleukin-1β) and growth- inhibitory cytokines (transforming growth factor-β, macrophage inflammatory protein-1α, and tumor necrosis factor-α). The relative proportion of different cell types in CML and normal stroma was similar. However, polymerase chain reaction and fluorescence in situ hybridization studies showed the presence of bcr-abl-positive cells in CML stroma, which were CD14+ stromal macrophages. To assess the effect of these malignant macrophages on stromal function, CML and normal stromal cells were separated by fluorescence-activated cell sorting into stromal mesenchymal cell (CD14- ) and macrophage (CD14+) populations. CML and normal CD14 cells supported the growth of normal LTC-IC equally well. However, the addition of CML macrophages to normal or CML CD14- mesenchymal cells resulted in impaired progenitor support. This finding indicates that the abnormal function of CML bone marrow stroma is related to the presence of malignant macrophages. In contrast to normal LTC-IC, the growth of CML LTC-IC on allogeneic CML stromal layers was not impaired and was significantly better than that of normal LTC- IC cocultured with the same CML stromal layers. These studies demonstrate that, in addition to abnormalities in CML progenitors themselves, abnormalities in the CML marrow microenvironment related to the presence of malignant stromal macrophages may contribute to the selective expansion of leukemic progenitors and suppression of normal hematopoiesis in CML.