Treatment of patients with myelofibrosis with the type I JAK (Janus kinase) inhibitor ruxolitinib paradoxically induces JAK2 activation loop phosphorylation and is associated with a life-threatening cytokine-rebound syndrome if rapidly withdrawn. We developed a time-dependent assay to mimic ruxolitinib withdrawal in primary JAK2V617F and CALR mutant myelofibrosis patient samples and observed notable activation of spontaneous STAT signaling in JAK2V617F samples after drug washout. Accumulation of ruxolitinib-induced JAK2 phosphorylation was dose dependent and correlated with rebound signaling and the presence of a JAK2V617F mutation. Ruxolitinib prevented dephosphorylation of a cryptic site involving Tyr1007/1008 in JAK2 blocking ubiquitination and degradation. In contrast, a type II JAK inhibitor, CHZ868, did not induce JAK2 phosphorylation, was not associated with withdrawal signaling, and was superior in the eradication of flow-purified JAK2V617F mutant CD34+ progenitors after drug washout. Type I inhibitor–induced loop phosphorylation may act as a pathogenic signaling node released upon drug withdrawal, especially in JAK2V617F patients.