Son of Sevenless 1 (SOS1) is a dual guanine nucleotide exchange factor (GEF) that activates the small GTPases RAC and RAS. Although the molecular mechanisms of RAS GEF catalysis have been unveiled, how SOS1 acquires RAC GEF activity and what is the physio-pathological relevance of this activity is much less understood. Here we show that SOS1 is tyrosine phosphorylated on Y1196 by ABL. Phosphorylation of Y1196 controls SOS1 inter-molecular interaction, is required to promote the exchange of nucleotides on RAC in vitro and for platelet-derived growth factor (PDGF) activation of RAC- and RAC-dependent actin remodeling and cell migration. SOS1 is also phosphorylated on Y1196 by BCR-ABL in chronic myelogenous leukemic cells. Importantly, in these cells, SOS1 is required for BCR-ABL-mediated activation of RAC, cell proliferation and transformation in vitro and in a xenograft mouse model. Finally, genetic removal of Sos1 in the bone marrow-derived cells (BMDCs) from Sos1fl/fl mice and infected with BCR-ABL causes a significant delay in the onset of leukemogenesis once BMDCs are injected into recipient, lethally irradiated mice. Thus, SOS1 is required for full transformation and critically contribute to the leukemogenic potential of BCR-ABL.