Protein tyrosine phosphatase PTP1B is a critical regulator of signaling pathways controlling metabolic homeostasis, cell proliferation, and immunity. In this study, we report that global or myeloid-specific deficiency of PTP1B in mice decreases lifespan. We demonstrate that myeloid-specific deficiency of PTP1B is sufficient to promote the development of acute myeloid leukemia. LysM-PTP1B−/− mice lacking PTP1B in the innate myeloid cell lineage displayed a dysregulation of bone marrow cells with a rapid decline in population at midlife and a concomitant increase in peripheral blood blast cells. This phenotype manifested further with extramedullary tumors, hepatic macrophage infiltration, and metabolic reprogramming, suggesting increased hepatic lipid metabolism prior to overt tumor development. Mechanistic investigations revealed an increase in anti-inflammatory M2 macrophage responses in liver and spleen, as associated with increased expression of arginase I and the cytokines IL10 and IL4. We also documented STAT3 hypersphosphorylation and signaling along with JAK-dependent upregulation of antiapoptotic proteins Bcl2 and BclXL. Our results establish a tumor suppressor role for PTP1B in the myeloid lineage cells, with evidence that its genetic inactivation in mice is sufficient to drive acute myeloid leukemia.