Hematopoiesis is a highly regulated process resulting in the formation of all blood lineages. Aberrant regulation of phosphatidylinositol-3-kinase (PI3K) signaling has been observed in hematopoietic malignancies, suggesting that regulated PI3K signaling is critical for regulation of blood cell production. An ex vivo differentiation system was used to investigate the role of PI3K and its downstream effector, protein kinase B (PKB/c-akt) in myelopoiesis. PI3K activity was essential for hematopoietic progenitor survival. High PKB activity was found to promote neutrophil and monocyte development, while, conversely, reduction of PKB activity was required to induce optimal eosinophil differentiation. In addition, transplantation of β2-microglobulin (−/−) NOD/SCID mice with CD34⁺ cells ectopically expressing constitutively active PKB resulted in enhanced neutrophil and monocyte development, whereas ectopic expression of dominant-negative PKB induced eosinophil development in vivo. Inhibitory phosphorylation of C/EBPα on Thr222/226 was abrogated upon PKB activation in hematopoietic progenitors. Ectopic expression of a nonphosphorylatable C/EBPα mutant inhibited eosinophil differentiation ex vivo, whereas neutrophil development was induced, demonstrating the importance of PKB-mediated C/EBPα phosphorylation in regulation of granulopoiesis. These results identify an important novel role for PKB in regulation of cell fate choices during hematopoietic lineage commitment.