One of the challenging questions in cancer biology is how a normal cell transforms into a cancer cell. There is strong evidence that specific chromosomal translocations are a key element in this transformation process. Our studies focus on understanding the developmental mechanism by which a normal stem or progenitor cell transforms into leukemia. Here we used engineered nucleases to induce simultaneous specific double strand breaks in the MLL gene and two different known translocation partners (AF4 and AF9), which resulted in specific chromosomal translocations in K562 cells as well as primary hematopoietic stem and progenitor cells (HSPCs). The initiation of a specific MLL translocation in a small number of HSPCs likely mimics the leukemia-initiating event that occurs in patients. In our studies, the creation of specific MLL translocations in CD34+ cells was not sufficient to transform cells in vitro. Rather, a variety of fates was observed for translocation positive cells including cell loss over time, a transient proliferative advantage followed by loss of the clone, or a persistent proliferative advantage. These studies highlight the application of genome engineering tools in primary human HSPCs to induce and prospectively study the consequences of initiating translocation events in leukemia pathogenesis.