ABCG2 is an efflux transporter conferring multidrug resistance (MDR) on cancer cells. However, the initial molecular events leading to its up-regulation in MDR tumor cells are poorly understood. Herein, we explored the impact of drug treatment on the methylation status of the ABCG2 promoter and consequent reactivation of ABCG2 gene expression in parental tumor cell lines and their MDR sublines. We demonstrate that ABCG2 promoter methylation is common in T-cell acute lymphoblastic leukemia (T-ALL) lines, also present in primary T-ALL lymphoblast specimens. Furthermore, drug selection with sulfasalazine and topotecan induced a complete demethylation of the ABCG2 promoter in the T-ALL and ovarian carcinoma model cell lines CCRF-CEM and IGROV1, respectively. This resulted in a dramatic induction of ABCG2 messenger RNA levels (235- and 743-fold, respectively) and consequent acquisition of an ABCG2-dependent MDR phenotype. Quantitative genomic polymerase chain reaction and ABCG2 promoter-luciferase reporter assay did not reveal ABCG2 gene amplification or differential transcriptional trans-activation, which could account for ABCG2 up-regulation in these MDR cells. Remarkably, mimicking cytotoxic bolus drug treatment through 12- to 24-hour pulse exposure of ABCG2-silenced leukemia cells, to clinically relevant concentrations of the chemotherapeutic agents daunorubicin and mitoxantrone, resulted in a marked transcriptional up-regulation of ABCG2. Our findings establish that antitumor drug-induced epigenetic reactivation of ABCG2 gene expression in cancer cells is an early molecular event leading to MDR. These findings have important implications for the emergence, clonal selection, and expansion of malignant cells with the MDR phenotype during chemotherapy.