Objective Constitutive activation of Stat5 has been observed in a variety of malignancies, particularly myeloid leukemias. To directly investigate the in vivo consequences of Stat5 perturbation, we expressed constitutively active forms in zebrafish. Methods We generated mutants of the zebrafish stat5.1 protein (N646H, H298R/N714F, and N714F) based on previously identified constitutively active mutants of murine Stat5a. The in vitro properties of these mutants were determined using phosphorylation-specific antibodies and luciferase reporter assays, and their in vivo effects were analyzed through microinjection of zebrafish embryos. Results Two of these stat5.1 mutants (N646H and H298R/N714F) showed increased tyrosine phosphorylation and transactivation activity compared to the wild-type protein. Expression of either mutant led to a range of hematological perturbations, which were more pronounced for the H298R/N714F mutant. Interestingly, expression of wild-type also produced generally similar phenotypes. Further analysis showed that expression of the H298R/N714F mutant led to increased numbers of early and late myeloid cells, erythrocytes, and B cells. Some nonhematopoietic developmental perturbations were also observed, but these were equally prominent with wild-type or mutant forms. Conclusion These data implicate Stat5 activity as a direct critical regulator of hematological cell proliferation, suggesting a causal role for constitutively-active Stat5 in the etiology of hematological malignancies.