The U2AF heterodimer has been well studied for its role in defining functional 3' splice sites in pre-mRNA splicing, but many fundamental questions still remain unaddressed regarding the function of U2AF in mammalian genomes. Through genome-wide analysis of U2AF-RNA interactions, we report that U2AF has the capacity to directly define ~88% of functional 3' splice sites in the human genome, but numerous U2AF binding events also occur in intronic locations. Mechanistic dissection reveals that upstream intronic binding events interfere with the immediate downstream 3' splice site associated either with the alternative exon, to cause exon skipping, or with the competing constitutive exon, to induce exon inclusion. We further demonstrate partial functional impairment with leukemia-associated mutations in U2AF35, but not U2AF65, in regulated splicing. These findings reveal the genomic function and regulatory mechanism of U2AF in both normal and disease states.