TEL-platelet-derived growth factor-beta receptor (TEL-PDGFbetaR) is expressed in chronic myelomonocytic leukemias associated with t(5;12)(q33;p13), and the fusion tyrosine kinase retains a conserved WW-like domain in the PDGFbetaR autoinhibitory juxtamembrane region. Here we report that mutation of the 2 conserved tryptophan residues of the WW-like domain has opposing effects on TELPDGFbetaR kinase activation. Alanine substitution of W593, essential for protein-protein interaction in the context of other WW domains, impaired TEL-PDGFbetaR-mediated transformation of hematopoietic cells due to inhibition of TEL-PDGFbetaR kinase activity. In contrast, alanine substitution of W566, essential for structural integrity of WW domain in other contexts, had no effect on TEL-PDGFbetaR activation and oncogenic activity. Surprisingly, however, the W566A mutation suppressed the W593A phenotype. Double mutant W566A/W593A was indistinguishable from the wild-type fusion protein with regard to kinase activity, ability to confer factor-independent growth to Ba/F3 cells, or ability to induce a myeloproliferative disease in mice. Additional mutational analysis identified other substitutions within the WW-like domain in addition to W566A that could also suppress the W593A phenotype, including mutations predicted to diminish the autoinhibitory function of the juxtamembrane region. Therefore, the WW-like domain in the context of TELPDGFbetaR may have both positive and negative regulatory roles in kinase activation.