Nucleophosmin (NPM1) gene has been heavily implicated in cancer pathogenesis both as a putative proto-oncogene and tumor suppressor gene. NPM1 is the most frequently mutated gene in acute myeloid leukemia (AML), while deletion of 5q, where NPM1 maps, is frequent in patients with myelodysplastic syndromes (MDS). We have previously shown that mice heterozygous for Npm1 (Npm1^+/−) develop a hematologic syndrome with features of human MDS. Here we analyzed Npm1^+/− mutants to determine their susceptibility to cancer. Npm1^+/− mice displayed a greater propensity to develop malignancies compared with Npm1^+/+ mice. The Npm1^+/− cohort frequently developed hematologic malignancies of both myeloid and lymphoid origin with myeloid malignancies displaying the highest incidence. Malignant cells retained the wild-type allele with normal localization and expression of Npm1 at the protein level, suggesting that complete Npm1 loss is not a prerequisite for tumorigenesis. Our results conclusively demonstrate that Npm1 acts as a haploinsufficient tumor suppressor in the hematopoietic compartment.