The t(16;21)(q24;q22) translocation is a rare but recurrent chromosomal abnormality associated with therapy-related myeloid malignancies and a variant of the t(8;21) translocation in which the AML1 gene on chromosome 21 is rearranged. Here we report the molecular definition of this chromosomal aberration in four patients. We cloned cDNAs from the leukemic cells of a patient carrying t(16;21) by the reverse transcription polymerase chain reaction using an AML1-specific primer. The structural analysis of the cDNAs showed that AML1 was fused to a novel gene named MTG16 (Myeloid Translocation Gene on chromosome 16) which shows high homology to MTG8 (ETO/CDR) and MTGR1. Northern blot analysis using MTG16 probes mainly detected 4.5 kb and 4.2 kb RNAs, along with several other minor RNAs in various human tissues. As in t(8;21), the t(16;21) breakpoints occurred between the exons 5 and 6 of AML1, and between the exons 1 and 2 or the exons 3 and 4 of MTG16. The two genes are fused in-frame, resulting in the characteristic chimeric transcripts of this translocation. Although the reciprocal chimeric product, MTG16-AML1, was also detected in one of the t(16;21) patients, its protein product was predicted to be truncated. Thus, the AML1-MTG16 gene fusion in t(16;21) leukemia results in the production of a protein that is very similar to the AML1-MTG8 chimeric protein.