CD38 expression is an important prognostic marker in chronic lymphocytic leukemia (CLL) with high levels of CD38 associated with shorter overall survival. In this study, we used gene expression profiling and protein analysis of highly purified cell-sorted CD38(+) and CD38(-) chronic lymphocytic leukemia cells to elucidate a molecular basis for the association between CD38 expression and inferior clinical outcome. Paired CD38(+) and CD38(-) CLL cells derived from the same patient were shown to be monoclonal by V(H) gene sequencing but despite this, CD38(+) CLL cells possessed a distinct gene expression profile when compared with their CD38(-) sub-clones. Importantly, CD38(+) CLL cells relatively over expressed vascular endothelial growth factor (VEGF) and appeared to preferentially utilize an internal autocrine VEGF survival loop. Elevated VEGF expression was associated with increased expression of the anti-apoptotic protein Mcl-1. Inhibition of VEGF receptor signaling also resulted in a reduction in cell viability. In contrast, exogenous VEGF caused a significant increase in CD38(-) CLL cell viability and a marked induction of Mcl-1; both effects were less obvious in CD38(+) CLL cells. Taken together, our data provide a biological rationale for the poor prognosis of CD38(+) CLL and indicate that both VEGF and Mcl-1 may prove to be useful therapeutic targets.