Adenosine deaminases that act on RNA (ADARs) convert adenosine residues to inosine in double-stranded RNA. In vivo, ADAR1 is essential for the maintenance of hematopoietic stem/progenitors. Whether other hematopoietic cell types also require ADAR1 has not been assessed. Using erythroid- and myeloid-restricted deletion of Adar1, we demonstrate that ADAR1 is dispensable for myelopoiesis but is essential for normal erythropoiesis. Adar1-deficient erythroid cells display a profound activation of innate immune signaling and high levels of cell death. No changes in microRNA levels were found in ADAR1-deficient erythroid cells. Using an editing-deficient allele, we demonstrate that RNA editing is the essential function of ADAR1 during erythropoiesis. Mapping of adenosine-to-inosine editing in purified erythroid cells identified clusters of hyperedited adenosines located in long 3’-untranslated regions of erythroid-specific transcripts and these are ADAR1-specific editing events. ADAR1-mediated RNA editing is essential for normal erythropoiesis.