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Cohesin complex members have recently been identified as putative tumor suppressors in hematologic and epithelial malignancies. The cohesin complex guides chromosome segregation; however, cohesin mutant leukemias do not show genomic instability. We hypothesized that reduced cohesin function alters chromatin structure and disrupts cis-regulatory architecture of hematopoietic progenitors. We investigated the consequences of Smc3 deletion in normal and malignant hematopoiesis. Biallelic Smc3 loss induced bone marrow aplasia with premature sister chromatid separation and revealed an absolute requirement for cohesin in hematopoietic stem cell (HSC) function. In contrast, Smc3 haploinsufficiency increased self-renewal in vitro and in vivo, including competitive transplantation. Smc3 haploinsufficiency reduced coordinated transcriptional output, including reduced expression of transcription factors …