Chromosomal translocations constitute driver mutations in solid tumors and leukemias. The mechanisms of how related or even identical gene fusions drive the pathogenesis of various tumor types remain elusive. One remarkable example is the presence of
EWSR1
fusions with
CREB1
and
ATF1,
members of the CREB family of transcription factors, in a variety of sarcomas, carcinomas and mesotheliomas. To address this, we have developed
in vitro
models of oncogenic fusions, in particular,
EWSR1-CREB1
and
EWSR1-ATF1,
in human embryonic stem (hES) cells, which are capable of multipotent differentiation, using CRISPR-Cas9 technology and HDR together with conditional fusion gene expression that allows investigation into the early steps of cellular transformation. We show that expression of
EWSR1-CREB1/ATF1
fusion in hES cells recapitulates the core gene signatures, respectively, of angiomatoid fibrous histiocytoma (AFH) and gastrointestinal clear cell sarcoma (GI-CCS), although both fusions lead to cell lethality. Conversely, expression of the fusions in hES cells differentiated to mesenchymal progenitors is compatible with prolonged viability while maintaining the core gene signatures. Moreover, in the context of a mesenchymal lineage, the proliferation of cells expressing the
EWSR1-CREB1
fusion is further extended by deletion of the tumor suppressor
TP53
. We expect the generation of isogenic lines carrying oncogenic fusions in various cell lineages to expand our general understanding of how those single genetic events drive tumorigenesis while providing valuable resources for drug discovery.