Nucleophosmin 1 (NPM1) is a nucleolar protein involved in ribosome biogenesis, stress responses and maintaining genome stability. One-third of acute myeloid leukemias (AMLs) are associated with aberrant localization of NPM1 to the cytoplasm (NPM1c+). This mutation is critical during leukemogenesis and constitutes a good prognostic factor for chemotherapy. At present, there is no clear molecular basis for the role of NPM1 in DNA repair and the tumorigenic process. We found that the nuclear apurinic/apyrimidinic endonuclease 1 (APE1), a core enzyme in base excision DNA repair (BER) of DNA lesions, specifically interacts with NPM1 within nucleoli and the nucleoplasm. Cytoplasmic accumulation of APE1 is associated with cancers including, as we show, NPM1c+ AML. Here we show that NPM1 stimulates APE1 BER activity in cells. We provide evidence that expression of the NPM1c+ variant causes cytoplasmic accumulation of APE1 in: (i) a heterologous cell system (HeLa cells); (ii) the myeloid cell line OCI/AML3 stably expressing NPM1c+; and (iii) primary lymphoblasts of NPM1c+ AML patients. Consistent with impaired APE1 localization, OCI/AML3 cells and blasts of AML patients have impaired BER activity. Cytoplasmic APE1 in NPM1c+ myeloid cells is truncated due to proteolysis. Thus, the good prognostic response of NPM1c+ AML to chemotherapy may result from the cytoplasmic relocalization of APE1 and the consequent BER deficiency. NPM1 thus has an indirect but significant role in BER in vivo that may also be important for NPM1c+ tumorigenesis.