Signaling via the intracellular second messenger cyclic AMP (cAMP) has long been implicated in the repression of megakaryocytic differentiation. However, the mechanisms by which cAMP signaling impairs megakaryopoiesis have never been elucidated. In a human CD34(+) cell culture model, we show that the adenylyl cyclase agonist forskolin inhibits megakaryocytic differentiation in a protein kinase A-dependent manner. Using this system to screen for downstream effectors, we identified the transcription factor E2A as a key target in a novel repressive signaling pathway. Specifically, forskolin acting through protein kinase A-induced E2A down-regulation and enforced expression of E2A overrode the inhibitory effects of forskolin on megakaryopoiesis. The dependence of megakaryopoiesis on critical thresholds of E2A expression was confirmed in vivo in haploinsufficient mice and ex vivo using shRNA knockdown in human progenitors. Using a variety of approaches, we further identified p21 (encoded by CDKN1A) as a functionally important megakaryopoietic regulator residing downstream of E2A. These results thus implicate the E2A-CDKN1A transcriptional axis in the control of megakaryopoiesis and reveal the lineage-selective inhibition of this axis as a likely mechanistic basis for the inhibitory effects of cAMP signaling.