Abstract Chromosomal translocations and activation of the fibroblast growth factor (FGF) receptor 1 (FGFR1) are a feature of stem cell leukemia–lymphoma syndrome (SCLL), an aggressive malignancy characterized by rapid transformation to acute myeloid leukemia and lymphoblastic lymphoma. It has been suggested that FGFR1 proteins lose their ability to recruit Src kinase, an important mediator of FGFR1 signaling, as a result of the translocations that delete the extended FGFR substrate-2 (FRS2) interacting domain that Src binds. In this study, we report evidence that refutes this hypothesis and reinforces the notion that Src is a critical mediator of signaling from the FGFR1 chimeric fusion genes generated by translocation in SCLL. Src was constitutively active in BaF3 cells expressing exogenous FGFR1 chimeric kinases cultured in vitro as well as in T-cell or B-cell lymphomas they induced in vivo. Residual components of the FRS2-binding site retained in chimeric kinases that were generated by translocation were sufficient to interact with FRS2 and activate Src. The Src kinase inhibitor dasatinib killed transformed BaF3 cells and other established murine leukemia cell lines expressing chimeric FGFR1 kinases, significantly extending the survival of mice with SCLL syndrome. Our results indicated that Src kinase is pathogenically activated in lymphomagenesis induced by FGFR1 fusion genes, implying that Src kinase inhibitors may offer a useful option to treatment of FGFR1-associated myeloproliferative/lymphoma disorders. Cancer Res; 71(23); 7312–22. ©2011 AACR.