The tumor suppressor p19ARF inhibits Mdm2, which restricts the activity of p53. Complicated feedback and control mechanisms regulate ARF, Mdm2, and p53 interactions. Here we report that ARF haploinsufficiency completely rescued the p53-dependent effects of Mdm2 haploinsufficiency on B-cell development, survival, and transformation. In contrast to Mdm2+/- B cells, Mdm2+/- B cells deficient in ARF were similar to wild-type B cells in their rates of growth and apoptosis and activation of p53. Consequently, the profoundly reduced numbers of B cells in Mdm2+/-Emu-myc transgenic mice were restored to normal levels in ARF+/-Mdm2+/-Emu-myc transgenics. Additionally, ARF+/-Mdm2+/-Emu-myc transgenics developed lymphomas at rates analogous to those observed for wild-type Emu-myc transgenics, demonstrating that loss of one allele of ARF rescued the protracted lymphoma latency in Mdm2+/-Emu-myc transgenics. Importantly, in ARF+/-Mdm2+/-Emu-myc transgenic lymphomas, p53 was inactivated at the frequency observed in lymphomas of wild-type Emu-myc transgenics. Collectively, these results support a model whereby the stoichiometry of Mdm2 and ARF controls apoptosis and tumor development, which should have significant implications in the treatment of malignancies that have inactivated ARF.