The early-life immune environment has been implicated as a modulator of acute lymphoblastic leukemia (ALL) development in children, with infection being associated with significant changes in ALL risk. Furthermore, polymorphisms in several cytokine genes, including IL-10 and IFN-γ, are associated with leukemia development. However, the mechanisms and timing of these influences remain unknown. Here, we use the Eμ-ret transgenic mouse model of B-cell precursor ALL to assess the influence of IFN-γ on the early-life burden of leukemia-initiating cells. The absence of IFN-γ activity resulted in greater numbers of leukemia-initiating cells early in life and was associated with accelerated leukemia onset. The leukemia-initiating cells from IFN-γ-knockout mice had reduced suppressor of cytokine signaling (SOCS-1) expression, were significantly more sensitive to IFN-γ, and exhibited more rapid expansion in vivo than their wild-type counterparts. However, sensitivity to this inhibitory pathway was lost in fully transformed IFN-γ-knockout leukemia cells. These results demonstrate that the influence of IFN-γ on ALL progression may not be mediated by selection of nascent transformed cells but rather through a general SOCS-mediated reduction in B-cell precursor proliferation. Thus, while cytokine levels may influence leukemia at multiple points during disease progression, our study indicates a significant early influence of basal, infection-independent cytokine production on leukemogenesis.