Hox proteins control genetic programs that orchestrate development, and a large subset of Hox proteins can bind DNA elements as heterodimers with the Pbx family of homeodomain proteins. A transcriptionally activated version of Pbx1, E2a-Pbx1, is an oncoprotein in human pre-B cell leukemia that strongly suppresses differentiation and retains its ability to heterodimerize with Hox proteins. Because monomeric Hox proteins bind very similar DNA motifs, it is unclear how they activate diverse developmental programs. Here we demonstrate that heterodimers containing different Hox proteins and a common Pbx1 or E2a-Pbx1 partner bind different DNA motifs. Structural models suggest that the specificity of the Hox protein is altered by a conformation change involving residues in the N-terminal arm of the Hox homeodomain. Mutational analysis also supported the hypothesis that unique sequences in the N-terminal arm of the Hox homeodomain are at least partially responsible for mediating this specificity. In vivo, Hox proteins directed E2a-Pbx1-mediated transactivation with moderate specificity to cognate Hox-Pbx motifs. Thus, the development specificity of individual Hox proteins may be mediated, in part, by differential targeting of cellular genes by Pbx1-Hox complexes. Likewise, through its function as a common heterodimer partner, oncoprotein E2a-Pbx1 may be able to interfere with multiple programs of development that are induced by the sequential or simultaneous expression of Hox proteins during hematopoiesis.