Early B-lymphopoiesis requires the growth-factor receptors, IL-7R and Flt3, and the activity of a number of transcription factors. One factor, Pax5, is required for commitment to the B-cell lineage, although the molecular mechanism by which this occurs is unknown. We demonstrate here that an important function of Pax5 is to repress Flt3 transcription in B-cell progenitors, as Pax5-deficient pro-B cells express abundant Flt3 that is rapidly silenced upon the reintroduction of Pax5, whereas enforced expression of Flt3 in wild-type progenitors significantly impairs B-cell development. These findings demonstrate that the repression of Flt3 by Pax5 is essential for normal B-lymphopoiesis.