The epigenetic silencing of tumor suppressor genes (TSGs) is critical in the development of chronic myeloid leukemia (CML). SHP-1 functions as a TSG and negatively regulates JAK/STAT signaling. Enhancement of SHP-1 expression by demethylation provides molecular targets for the treatment of various cancers. Thymoquinone (TQ), a constituent of Nigella sativa seeds, has shown anti-cancer activities in various cancers. However, TQs effect on methylation is not fully clear. Therefore, the aim of this study is to assess TQs ability to enhance the expression of SHP-1 through modifying DNA methylation in K562 CML cells. The activities of TQ on cell cycle progression and apoptosis were evaluated using a fluorometric-red cell cycle assay and Annexin V-FITC/PI, respectively. The methylation status of SHP-1 was studied by pyrosequencing analysis. The expression of SHP-1, TET2, WT1, DNMT1, DNMT3A, and DNMT3B was determined using RT-qPCR. The protein phosphorylation of STAT3, STAT5, and JAK2 was assessed using Jess Western analysis. TQ significantly downregulated the DNMT1 gene, DNMT3A gene, and DNMT3B gene and upregulated the WT1 gene and TET2 gene. This led to hypomethylation and restoration of SHP-1 expression, resulting in inhibition of JAK/STAT signaling, induction of apoptosis, and cell cycle arrest. The observed findings imply that TQ promotes apoptosis and cell cycle arrest in CML cells by inhibiting JAK/STAT signaling via restoration of the expression of JAK/STAT-negative regulator genes.