Phosphate is critical in multiple biological processes (phosphorylation reactions, ATP production, and DNA structure and synthesis). It remains unclear how individual cells initially sense changes in phosphate availability and the cellular consequences of these changes. PiT1 (or SLC20A1) is a constitutively expressed, high-affinity sodium-dependent phosphate import protein. In vitro data suggest that PiT1 serves a direct role in mediating cellular proliferation; its role in vivo is unclear. We have discovered that mice lacking PiT1 develop a profound underproduction anemia characterized by mild macrocytosis, dyserythropoiesis, increased apoptosis, and a near complete block in terminal erythroid differentiation. In addition, the animals are severely B cell lymphopenic because of a defect in pro-B cell development and mildly neutropenic. The phenotype is intrinsic to the hematopoietic system, is associated with a defect in cell cycle progression, and occurs in the absence of changes in serum phosphate or calcium concentrations and independently of a change in cellular phosphate uptake. The severity of the anemia and block in terminal erythroid differentiation and B cell lymphopenia are striking and suggest that PiT1 serves a fundamental and nonredundant role in murine terminal erythroid differentiation and B cell development. Intriguingly, as the anemia mimics the ineffective erythropoiesis in some low-grade human myelodysplastic syndromes, this murine model might also provide pathologic insight into these disorders.