Abstract Signaling pathways that control vital features of leukemic stem cells including multipotency, self-renewal, clonal expansion and quiescence remain unclear. Emerging studies illustrate critical roles for lysosomes in hematopoietic and leukemic stem cell fate. By investigating consequences of INPP4B alterations in AML, we have discovered its role in driving leukemic ‘stemness’. We observed that INPP4B is highly expressed leukemic stem cell populations and Inpp4b -deficeint leukemias demonstrate increased disease latency, reduced leukemia initiating potential which is associated with a differentiated leukemic phenotype. Molecular analyses show that Inpp4b -deficient leukemias have compromised lysosomal gene expression, lysosomal content, and lysosomal activity. Our discovery of a novel pathway linking INPP4B, lysosomal biogenesis and leukemic stemness, provides a mechanism to explain the association of high INPP4B expression with poor AML prognosis, and highlights novel patient stratification strategies and LSC-specific leukemic therapies. Key Points Our findings highlight a novel pathway linking INPP4B, lysosomal function and leukemic stemness that explains the prognostic role of INPP4B in AML. Our data reveal the utility of INPP4B as a biomarker of aggressive AML and provide a rationale to explore INPP4B and its associated function in lysosome biology as novel strategies to target LSC and AML