KMT2A-rearranged (KMT2A-r) infant acute lymphoblastic leukemia (ALL) is a devastating malignancy with a dismal outcome, and younger age at diagnosis is associated with increased risk of relapse. To discover age-specific differences and critical drivers that mediate poor outcome in KMT2A-r ALL, we subjected KMT2A-r leukemias and normal hematopoietic cells from patients of different ages to single-cell multiomics analyses. We uncovered the following critical new insights: leukemia cells from patients <6 months have significantly increased lineage plasticity. Steroid response pathways are downregulated in the most immature blasts from younger patients. We identify a hematopoietic stem and progenitor-like (HSPC-like) population in the blood of younger patients that contains leukemic blasts and form an immunosuppressive signaling circuit with cytotoxic lymphocytes. These observations offer a compelling explanation for the ability of leukemias in young patients to evade chemotherapy and immune-mediated control. Our analysis also revealed preexisting lymphomyeloid primed progenitors and myeloid blasts at initial diagnosis of B-ALL. Tracking of leukemic clones in 2 patients whose leukemia underwent a lineage switch documented the evolution of such clones into frank acute myeloid leukemia (AML). These findings provide critical insights into KMT2A-r ALL and have clinical implications for molecularly targeted and immunotherapy approaches. Beyond infant ALL, our study demonstrates the power of single-cell multiomics to detect tumor intrinsic and extrinsic factors affecting rare but critical subpopulations within a malignant population that ultimately determines patient outcome.