The chromosomal translocation t(8;21) and the resulting oncofusion gene AML1/ETO have long served as a prototypical genetic lesion to model and understand leukemogenesis. In this review, we describe the wide-ranging role of AML1/ETO in AML leukemogenesis, with a particular focus on the aberrant epigenetic regulation of gene transcription driven by this AML-defining mutation. We begin by analyzing how structural changes secondary to distinct genomic breakpoints and splice changes, as well as posttranscriptional modifications, influence AML1/ETO protein function. Next, we characterize how AML1/ETO recruits chromatin-modifying enzymes to target genes and how the oncofusion protein alters chromatin marks, transcription factor binding, and gene expression. We explore the specific impact of these global changes in the epigenetic network facilitated by the AML1/ETO oncofusion on cellular processes and leukemic growth. Furthermore, we define the genetic landscape of AML1/ETO-positive AML, presenting the current literature concerning the incidence of cooperating mutations in genes such as KIT, FLT3, and NRAS. Finally, we outline how alterations in transcriptional regulation patterns create potential vulnerabilities that may be exploited by epigenetically active agents and other therapeutics.