Abstract The conversion of 5-methylcytosine (5mC) to 5-hydroxymethylcytosine (5hmC) is a key step in DNA demethylation that is mediated by ten-eleven-translocation (TET) enzymes, which require ascorbate/vitamin C. Here, we report the 5hmC landscape of normal hematopoiesis and identify cell type-specific 5hmC profiles associated with active transcription and chromatin accessibility of key hematopoietic regulators. We utilized CRISPR/Cas9 to model TET2 loss-of-function mutations in primary human HSPCs. Disrupted cells exhibited increased colonies in serial replating, defective erythroid/megakaryocytic differentiation, and in vivo competitive advantage and myeloid skewing coupled with reduction of 5hmC at erythroid-associated gene loci. Azacitidine and ascorbate restored 5hmC abundance and slowed or reverted the expansion of TET2-mutant clones in vivo. These results demonstrate the key role of 5hmC in normal hematopoiesis and TET2-mutant phenotypes and raise the possibility of utilizing these agents to further our understanding of pre-leukemia/clonal hematopoiesis.