A somatic activating mutation (V617F) in the JAK2 tyrosine kinase was recently discovered in the majority of patients with polycythemia vera (PV), and some with essential thrombocythemia (ET) and chronic idiopathic myelofibrosis. However, the role of mutant JAK2 in disease pathogenesis is unclear. We expressed murine JAK2 WT or V617F via retroviral bone marrow transduction/transplantation in the hematopoietic system of two different inbred mouse strains, Balb/c and C57Bl/6 (B6). In both strains, JAK2 V617F, but not JAK2 WT, induced non-fatal polycythemia characterized by increased hematocrit and hemoglobin, reticulocytosis, splenomegaly, low plasma erythropoietin (Epo), and Epo-independent erythroid colonies. JAK2 V617F also induced leukocytosis and neutrophilia that was much more prominent in Balb/c mice than in B6. Platelet counts were not affected in either strain despite expression of JAK2 V617F in megakaryocytes and markedly prolonged tail bleeding times. The polycythemia tended to resolve after several months, coincident with increased spleen and marrow fibrosis, but was resurrected by transplantation to secondary recipients. Using donor mice with mutations in Lyn, Hck, and Fgr, we demonstrated that the polycythemia was independent of Src kinases. Polycythemia and reticulocytosis responded to treatment with imatinib or a JAK2 inhibitor, but were unresponsive to the Src inhibitor dasatinib. These findings demonstrate that JAK2 V617F induces Epo-independent expansion of the erythroid lineage in vivo. The fact that the central erythroid features of PV are recapitulated by expression of JAK2 V617F argues that it is the primary and direct cause of human PV. The lack of thrombocytosis suggests that additional events may be required for JAK2 V617F to cause ET, but qualitative platelet abnormalities induced by JAK2 V617F may contribute to the hemostatic complications of PV. Despite the role of Src kinases in Epo signaling, our studies predict that Src inhibitors will be ineffective for therapy of PV. However, we provide proof-of-principle that a JAK2 inhibitor should have therapeutic effects on the polycythemia, and perhaps myelofibrosis and hemostatic abnormalities, suffered by MPD patients carrying the JAK2 V617F mutation.