PAX5 is a tumor suppressor in B-ALL, while the role of PAX5 fusion proteins in B-ALL development is largely unknown. Here, we studied the function of PAX5-ETV6 and PAX5-FOXP1 in mice expressing these proteins from the Pax5 locus. Both proteins arrested B-lymphopoiesis at the pro-B to pre-B-cell transition and, contrary to their proposed dominant-negative role, did not interfere with the expression of most regulated Pax5 target genes. Pax5-Etv6, but not Pax5-Foxp1, cooperated with loss of the Cdkna2a/b tumor suppressors in promoting B-ALL development. Regulated Pax5-Etv6 target genes identified in these B-ALLs encode proteins implicated in pre-B-cell receptor (BCR) signaling and migration/adhesion, which could contribute to the proliferation, survival, and tissue infiltration of leukemic B cells. Together with similar observations made in human PAX5-ETV6+ B-ALLs, these data identified PAX5-ETV6 as a potent oncoprotein that drives B-cell leukemia development.