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Targeting the tyrosine kinase activity of Bcr-Abl is an attractive therapeutic strategy in chronic myeloid leukemia (CML) and in Bcr-Abl–positive acute lymphoblastic leukemia. Whereas imatinib, a selective inhibitor of Bcr-Abl tyrosine kinase, is now used in frontline therapy for CML, second-generation inhibitors of Bcr-Abl tyrosine kinase such as nilotinib or dasatinib have been developed for the treatment of imatinib-resistant or imatinib-intolerant disease. In the current study, we generated nilotinib-resistant cell lines and investigated their mechanism of resistance. Overexpression of BCR-ABL and multidrug resistance gene (MDR-1) were found among the investigated mechanisms. We showed that nilotinib is a substrate of the multidrug resistance gene product, P-glycoprotein, using verapamil or PSC833 to block binding. Up-regulated expression of p53/56 Lyn kinase, both at the mRNA and protein level, was found in one of the resistant cell lines and Lyn silencing by small interfering RNA restored sensitivity to nilotinib. Moreover, failure of nilotinib treatment was accompanied by an increase of Lyn mRNA expression in patients with resistant CML. Two Src kinase inhibitors (PP1 and PP2) partially removed resistance but did not significantly inhibit Bcr-Abl tyrosine kinase activity. In contrast, dasatinib, a dual Bcr-Abl and Src kinase inhibitor, inhibited the phosphorylation of both BCR-ABL and Lyn, and induced apoptosis of the Bcr-Abl cell line overexpressing p53/56 Lyn. Such mechanisms of resistance are close to those observed in imatinib-resistant cell lines and emphasize the critical role of Lyn in nilotinib resistance. [Cancer Res 2008;68(23):9809–16]