Transcription factor CCAAT enhancer binding protein α (C/EBPα) is essential for granulopoiesis and its function is deregulated in leukemia. Inhibition of E2F1, the master regulator of cell-cycle progression, by C/EBPα is pivotal for granulopoiesis. Recent studies show microRNA-223 (miR-223), a transcriptional target of C/EBPα, as a critical player during granulopoiesis. In this report, we demonstrate that during granulopoiesis microRNA-223 targets E2F1. E2F1 protein was up-regulated in miR-223 null mice. We show that miR-223 blocks cell-cycle progression in myeloid cells. miR-223 is down-regulated in different subtypes of acute myeloid leukemia (AML). We further show that E2F1 binds to the miR-223 promoter in AML blast cells and inhibits miR-223 transcription, suggesting that E2F1 is a transcriptional repressor of the miR-223 gene in AML. Our study supports a molecular network involving miR-223, C/EBPα, and E2F1 as major components of the granulocyte differentiation program, which is deregulated in AML.