AbstractClustered regularly interspaced short palindromic repeats (CRISPR)–CRISPR-associated protein 9 (Cas9) is a powerful tool for introducing targeted mutations in DNA, but recent studies have shown that it can have unintended effects such as structural changes. However, these studies have not yet looked genome wide or across data types. Here we performed a phenotypic CRISPR–Cas9 scan targeting 17,065 genes in primary human cells, revealing a ‘proximity bias’ in which CRISPR knockouts show unexpected similarities to unrelated genes on the same chromosome arm. This bias was found to be consistent across cell types, laboratories, Cas9 delivery methods and assay modalities, and the data suggest that it is caused by telomeric truncations of chromosome arms, with cell cycle and apoptotic pathways playing a mediating role. Additionally, a simple correction is demonstrated to mitigate this pervasive bias while preserving biological relationships. This previously uncharacterized effect has implications for functional genomic studies using CRISPR–Cas9, with applications in discovery biology, drug-target identification, cell therapies and genetic therapeutics.