The tyrosine kinase domain (TKD) mutations of receptor tyrosine kinase C-KIT are associated with a poor prognosis in acute myeloid leukemia (AML). However, the underlying mechanisms are not fully understood. We found the activity of protein phosphatase 2A (PP2A), a human tumor suppressor whose dysfunction contributes to malignant cell behavior, was significantly decreased in AML subgroups harboring C-KIT/D816V and AML cell line Kasumi-1 bearing C-KIT/N822K mutation. Primary AML cells and various AML cell lines were treated with PP2A activator FTY720. FTY720 showed a toxic effect in all leukemic cells, especially for cells harboring C-KIT/TKD mutation. Furthermore, FTY720-induced toxicity in AML leukemic cells was mediated by restoration of PP2A activity, via down-regulation of PP2A inhibitor SET, dephosporylation of PP2A-CTYR307, and up-regulation of relevant PP2A subunit A and B55a. Our research indicates that the decreased PP2A activity in AML harboring C-KIT/TKD mutation may make the restoration of PP2A activity a novel therapy for AML patients with C-KIT/TKD mutation. J. Cell. Biochem. 113: 13141322, 2012. (c) 2011 Wiley Periodicals, Inc.