Ldb1, a ubiquitously expressed LIM domain binding protein, is essential in a number of tissues during development. It interacts with Gata1, Tal1, E2A and Lmo2 to form a transcription factor complex regulating late erythroid genes. We identify a number of novel Ldb1 interacting proteins in erythroleukaemic cells, in particular the repressor protein Eto-2 (and its family member Mtgr1), the cyclin-dependent kinase Cdk9, and the bridging factor Lmo4. MO-mediated knockdowns in zebrafish show these factors to be essential for definitive haematopoiesis. In accordance with the zebrafish results these factors are coexpressed in prehaematopoietic cells of the early mouse embryo,although we originally identified the complex in late erythroid cells. Based on the change in subcellullar localisation of Eto-2 we postulate that it plays a central role in the transition from the migration and expansion phase of the prehaematopoietic cells to the establishment of definitive haematopoietic stem cells.