Transient abnormal myelopoiesis (TAM) in neonates with Down syndrome, which spontaneously resolves within several weeks or months after birth, may represent a very special form of leukemia arising in the fetal liver (FL). To explore the role of the fetal hematopoietic microenvironment in the pathogenesis of TAM, we examined the in vitro influences of stromal cells of human FL and fetal bone marrow (FBM) on the growth of TAM blasts. Both FL and FBM stromal cells expressed mesenchymal cell antigens (vimentin, α-smooth muscle actin, CD146, and nestin), being consistent with perivascular cells/mesenchymal stem cells that support hematopoietic stem cells. In addition, a small fraction of the FL stromal cells expressed an epithelial marker, cytokeratin 8, indicating that they could be cells in epithelial-mesenchymal transition (EMT). In the coculture system, stromal cells of the FL, but not FBM, potently supported the growth of TAM blast progenitors, mainly through humoral factors. High concentrations of hematopoietic growth factors were detected in culture supernatants of the FL stromal cells and a neutralizing antibody against granulocyte-macrophage colony-stimulating factor (GM-CSF) almost completely inhibited the growth-supportive activity of the culture supernatants. These results indicate that FL stromal cells with unique characteristics of EMT cells provide a pivotal hematopoietic microenvironment for TAM blasts and that GM-CSF produced by FL stromal cells may play an important role in the pathogenesis of TAM. J. Cell. Biochem. 115: 1176–1186, 2014. © 2013 Wiley Periodicals, Inc.