Aberrant erythroid differentiation can give rise to anemias and leukemias. Regulated transcription elongation at erythroid loci is vital for specific differentiation steps during blood development. Transcriptional intermediary factor 1 gamma (TIF1γ), whose gene is mutated in the blood deficient zebrafish moonshine mutant, recruits positive elongation factors to erythroid genes, thus relieving paused Pol II. To elucidate the TIF1γ-mediated mechanisms in erythroid differentiation, we have performed a chemical suppressor screen in the bloodless moonshine mutant. Progeny of heterozygous moonshine mutants were treated at 50% epiboly with 4,000 individual chemical compounds with mostly known functional targets. A rescue in blood formation was assessed for by in situ hybridization for β-globin e3 expression in primitive erythrocytes at 22 hours post fertilization (hpf). Using this strategy we have identified peroxisome proliferator-activated receptor alpha (PPARα) agonists, most importantly, Clofibrate to rescue βe3 globin expression at 22 hpf in 70 - 90% of moonshine embryos in a dose-dependent manner. To address whether the rescue by Clofibrate is due to its activation of the PPARα receptor, we either knocked down PPARα using morpholinos or treated zebrafish embryos with the PPARα antagonist GW6471. In both cases we observed a significant reduction in Clofibrate-mediated rescue. To identify the PPARα-interacting proteome in an erythroid progenitor context, human K562 erythroleukemia cells expressing doxycyclin-inducible Flag-PPARα were generated. In these cells, PPARα target genes such as ANGPTL4 and PDK4 are activated starting four hours after doxycyclin addition and this activation is significantly reduced in the presence of the PPARα antagonist GW6471. Large-scale Flag-immunoprecipitation followed by mass spectrometric analysis identified the heterodimerization partner of PPARα, RXR, co-activators (NCOA1, NCOA6) and co-repressors (NCOR2), furthermore 24 subunits of the mediator complex, six subunits of the cohesin (loading) complex, seven RNA polymerase (Pol) II subunits as well as the Cyclin T1 subunit of P-TEFb and both subunits (SUPT5H, SUPT4H1) of DSIF, two proteins with a positive role in transcription elongation. In co-immunoprecipitation experiments using K562 cells, doxycyclin-induced PPARα activation leads to an enhanced interaction of Pol II with both, the Cyclin T1 and CDK9 subunits of P-TEFb. Morpholino-mediated knockdown of the mediator complex subunit med1 prevents Clofibrate-mediated rescue of βe3 globin expression in moonshine embryos. Together these data suggest that PPARα functionally interacts with the mediator complex in hematopoietic progenitors, leading to increased recruitment of the transcription elongation factors to lineage-specific genes. Our studies provide a basic understanding of the processes that regulate transcription elongation in the differentiation of hematopoietic cells, and could lead to novel therapeutic strategies for the treatment of blood diseases and leukemia. DisclosuresZon:FATE Therapeutics, Inc.: Consultancy, Equity Ownership, Founder Other, Membership on an entity’s Board of Directors or advisory committees, Patents & Royalties; Scholar Rock: Consultancy, Equity Ownership, Founder, Founder Other, Membership on an entity’s Board of Directors or advisory committees, Patents & Royalties.