Phase 1 Major Inclusion Criteria:

          1. Untreated AML, including patients with an antecedent hematologic disorder or secondary
             disease. Patients with prior MDS may have received therapy with immunomodulatory
             agents or hypomethylating agents for this diagnosis. Patients with other prior cancer
             diagnoses are allowed as long as they have no measurable disease, are not undergoing
             active therapy, and have a life expectancy of ≥ 4 months.

          2. Patients age ≥60 years who:

               1. Are unwilling to receive intensive (e.g. 7+3) chemotherapy, or

               2. Have poor-risk prognostic factors defined as antecedent hematologic disorder,
                  prior chemotherapy or XRT, abnormal karyotype other than t(8;21), inv16, or
                  t(16;16), any karyotype with FLT3-ITD, or presenting WBC>100K, or

               3. Have significant comorbidities, that in the judgment of the investigator makes
                  the subject unsuitable for standard dose induction chemotherapy (e.g.
                  anthracycline and infusional cytarabine given as 7+3), or;

               4. Any patient age ≥ 70 years.

          3. Blast count ≥20%

          4. Greater than 25% of blasts must be CD33 positive.

          5. Adequate renal and hepatic function

          6. ECOG ≤ 3

        Phase 2 Inclusion Criteria:

          1. Untreated AML, including patients with an antecedent hematologic disorder or secondary
             disease. Patients with prior MDS may have received therapy with immunomodulatory
             agents for this diagnosis.

          2. Patients age ≥60 years who:

               1. Patients ≥60 years unfit to receive intensive (e.g., 7+3) chemotherapy who have:

                    -  Congestive heart failure or documented cardiomyopathy with an EF ≤50%,
                       provided that EF ≥35% or,

                    -  Documented pulmonary disease with DLCO ≤65% or FEV1 ≤65%, provided that
                       patients do not require more than 2 L of oxygen per minute or,

                    -  Documented liver disease with marked elevation of transaminases >3 x ULN or,

                    -  Serum creatinine >1.2 mg/dL

               2. Have significant comorbidities, that in the judgment of the investigator makes
                  the subject unsuitable for standard dose induction chemotherapy (e.g.,
                  anthracycline and infusional cytarabine given as 7+3); or

               3. Any patient age ≥ 75 years.

          3. Blast count ≥ 20% (WHO criteria)

          4. Greater than 25% of blasts must be CD33 positive.

          5. Have a circulating blast count of less than 200/mm3 (control with hydroxyurea or
             similar agent is allowed);

          6. Creatinine < 2.0 mg/dl

          7. Estimated creatinine clearance ≥ 50ml/min

          8. Bilirubin ≤ 2.0 mg/dl; AST and ALT < 5.0 times the ULN

          9. Eastern Cooperative Oncology Group (ECOG) Performance Status ≤ 2

        Exclusion Criteria:

          1. Patients with acute promyelocytic leukemia

          2. Treatment with chemotherapy or biologic therapy within 3 weeks, except for
             hydroxyurea, which must be discontinued prior to treatment on study

          3. Treatment with radiation within 6 weeks

          4. Active serious infections uncontrolled by antibiotics

          5. Active malignancy within 2 years of entry, except previously treated non-melanoma skin
             cancer, carcinoma in situ or cervical intraepithelial neoplasia, and organ confined
             prostate cancer with no evidence of progressive disease based on PSA levels and are
             not on active therapy.

          6. Clinically significant cardiac or pulmonary disease

          7. Patients with liver cirrhosis

          8. Active CNS leukemia. Patients with symptoms of CNS involvement, particularly those
             with M4 or M5 subtypes, should undergo lumbar puncture prior to treatment on study to
             exclude CNS disease. Symptoms include cranial neuropathies, other neurologic deficits,
             and headache.

          9. Psychiatric disorder that would preclude study participation