Numerous cell types modulate hematopoiesis through soluble and membrane bound molecules. Whether developing hematopoietic progenitors of a particular lineage modulate the differentiation of other hematopoietic lineages is largely unknown. Here we aimed to investigate the influence of myeloid progenitors on CD34 + cell differentiation into CD56 + innate lymphocytes. Sorted CD34 + cells cultured in the presence of stem cell factor (SCF) and FMS-like tyrosine kinase 3 ligand (FLT3L) give rise to numerous cell types, including progenitors that expressed the prolactin receptor (PRLR). These CD34 + pRLR + myeloid-lineage progenitors were derived from granulocyte monocyte precursors (GMPs) and could develop into granulocytes in the presence of granulocyte-macrophage colonystimulating factor (GM-CSF) in vitro. Moreover, CD34 + pRLR + myeloid progenitors lacked lymphoid developmental potential, but when stimulated with prolactin (PRL) they increased the differentiation of other CD34 + cell populations into the NK lineage in a non-contact dependent manner. Both mRNA and protein analyses show that PRL increased mothers against decapentaplegic homolog 7 (SMAD7) in CD34 + pRLR + myeloid cells, which reduced the production of transforming growth factor beta 1 (TGF-β1), a cytokine known to inhibit CD56 + cell development. Thus, we uncover an axis whereby CD34 + pRLR + GMPs inhibit CD56 + lineage development through TGF-β1 production and PRL stimulation leads to SMAD7 activation, repression of TGF-β1, resulting in CD56 + cell development. Hematopoietic differentiation is specified by a multitude of soluble and membrane-bound molecules produced both within and outside of the hematopoietic system that influence cell fate decisions 1-6. In line with this, numerous cytokines including interleukin (IL)-1, IL-2, IL-7, IL-12, IL-15, IL-18, IL-21, IL-23, IL-25 and IL-33 have been shown to modulate the development of NK cells and other innate lymphoid cells (ILCs) 7-14. Moreover, NK cells and other ILCs require different transcription factors such as Tbet, RORc and Gata3 for their development 7,15,16. Multi-lymphoid progenitor (MLP) differentiate into the common ILC progenitor and this cell then gives rise to NK cells and all helper ILCs (i.e., ILC1, 2 and 3) 12-14,17. NK cells and helper ILCs are distinguished by specific transcription factor expression, cytokine production and function 9,13,14,18,19. We have used in vitro differentiation to study these processes and over the last decade have found that both NK cells and helper ILCs (particularly, ILC1s and ILC3s) develop in this system and similarly express CD56 16,20-23. Therefore, throughout this manuscript we use the term CD56 + lymphocytes to describe all CD56 expressing cells. Prolactin (PRL) is a neuroendocrine hormone best known for its role in lactation. However, PRL also regulates hematopoietic cell development and homeostasis 24-28. Specifically, PRL enhances the development of myeloid and