BCR-ABL fusion protein, a t(9;22) translocation product is indispensable for generation, maintenance and progression of chronic myeloid leukemia. RNA interference is an approach to silence gene at post-transcriptional level. We show that dsRNA targeted against the translocation region leads to more than 90% inhibition of BCR-ABL mRNA and protein expression levels using K562 as a model. Lack of BCR-ABL leads to cell cycle arrest in G1 phase as observed by decrease in cyclin D1 and increase in p21 and p27 cdk inhibitors mRNA. Apoptosis resistance imparted by BCR-ABL is lost in these cells in caspase-dependent or independent manner. Decrease in Bcl-XL is observed along with decrease in mitochondrial membrane integrity. Transient removal of BCR-ABL expression has a profound effect on proliferation and clonogenic capacity also confirmed by long-term silencing using lentiviral vectors. Interestingly, low level of BCR-ABL message leads to enhanced erythroid differentiation and reduced expression of megakaryocytic markers. Importantly, in six CML patient samples studied, silencing BCR-ABL in the lineage depleted enriched stem cell population leads to a decrease in colony-forming capacity. Thus, long-term silencing of BCR-ABL might prove to be a promising alternative approach in CML patients especially for those who do not respond to any other drug treatment.