17-Allylamino-demethoxy geldanamycin (17-AAG) inhibits the chaperone association of heat shock protein 90 (hsp90) with the heat shock factor-1 (HSF-1), which induces the mRNA and protein levels of hsp70. Increased hsp70 levels inhibit death receptor and mitochondria-initiated signaling for apoptosis. Here, we show that ectopic overexpression of hsp70 in human acute myelogenous leukemia HL-60 cells (HL-60/hsp70) and high endogenous hsp70 levels in Bcr-Abl-expressing cultured CML-BC K562 cells confers resistance to 17-AAG-induced apoptosis. In HL-60/hsp70 cells, hsp70 was bound to Bax, inhibited 17-AAG-mediated Bax conformation change and mitochondrial localization, thereby inhibiting the mitochondria-initiated events of apoptosis. Treatment with 17-AAG attenuated the levels of phospho-AKT, AKT, and c-Raf but increased hsp70 levels to a similar extent in the control HL-60/Neo and HL-60/hsp70 cells. Pretreatment with 17-AAG, which induced hsp70, inhibited 1-beta-D-arabinofuranosylcytosine or etoposide-induced apoptosis in HL-60 cells. Stable transfection of a small interfering RNA (siRNA) to hsp70 completely abrogated the endogenous levels of hsp70 and blocked 17-AAG-mediated hsp70 induction, resulting in sensitizing K562/siRNA-hsp70 cells to 17-AAG-induced apoptosis. This was associated with decreased binding of Bax to hsp70 and increased 17-AAG-induced Bax conformation change. 17-AAG-mediated decline in the levels of AKT, c-Raf, and Bcr-Abl was similar in K562 and K562/siRNA-hsp70 cells. Cotreatment with KNK437, a benzylidine lactam inhibitor of hsp70 induction and thermotolerance, attenuated 17-AAG-mediated hsp70 induction and increased 17-AAG-induced apoptosis and loss of clonogenic survival of HL-60 cells. Collectively, these data indicate that induction of hsp70 attenuates the apoptotic effects of 17-AAG, and abrogation of hsp70 induction significantly enhances the antileukemia activity of 17-AAG.