We analyzed the TS-2 acute lymphoblastic leukemia (ALL) cell line that contains a t(1;19)(q23;p13.3) but lacks E2A-PBX1 fusion typically present in leukemias with this translocation. We found that the t(1;19) in TS-2 fuses the 19p13 gene DAZAP1 (Deleted in Azoospermia-Associated Protein 1) to the 1q23 gene MEF2D (Myocyte Enhancer Factor 2D), leading to expression of reciprocal in-frame DAZAP1/MEF2D and MEF2D/DAZAP1 transcripts. MEF2D is a member of the MEF2 family of DNA binding proteins that activate transcription of genes involved in control of muscle cell differentiation, and signaling pathways that mediate response to mitogenic signals and survival of neurons and T-lymphocytes. DAZAP1 is a novel RNA binding protein expressed most abundantly in the testis. We demonstrate that MEF2D/DAZAP1 binds avidly and specifically to DNA in a manner indistinguishable from that of native MEF2D and is a substantially more potent transcriptional activator than MEF2D. We also show that DAZAP1/MEF2D is a sequence-specific RNA-binding protein. MEF2D has been identified as a candidate oncogene in murine retroviral insertional mutagenesis studies. Our data implicate MEF2D in human cancer and suggest that MEF2D/DAZAP1 and/or DAZAP1/MEF2D contribute to leukemogenesis by altering signaling pathways normally regulated by wild-type MEF2D and DAZAP1.