N⁶-Methyladenosine (m⁶A) represents the most prevalent internal modification in mammalian mRNAs. Despite its functional importance in various fundamental bioprocesses, the studies of m⁶A in cancer have been limited. Here we show that FTO, as an m⁶A demethylase, plays a critical oncogenic role in acute myeloid leukemia (AML). FTO is highly expressed in AMLs with t(11q23)/MLL rearrangements, t(15;17)/PML-RARA, FLT3-ITD, and/or NPM1 mutations. FTO enhances leukemic oncogene-mediated cell transformation and leukemogenesis, and inhibits all-trans-retinoic acid (ATRA)-induced AML cell differentiation, through regulating expression of targets such as ASB2 and RARA by reducing m⁶A levels in these mRNA transcripts. Collectively, our study demonstrates the functional importance of the m⁶A methylation and the corresponding proteins in cancer, and provides profound insights into leukemogenesis and drug response.