Decitabine and Gemtuzumab Ozogamicin in Acute Myelogenous Leukemia (AML) and High-Risk Myelodysplastic Syndrome (H-R MDS)

Inclusion Criteria:

1. Understand and voluntarily sign an informed consent form.
2. Age \>/= to 16 years at the time of signing the informed consent form.
3. Diagnosis of AML \[other than acute promyelocytic leukemia (APL)\] with refractory/relapsed disease. Patients with newly diagnosed AML will be eligible if not a candidate for intensive chemotherapy. Patients with high-risk (intermediate-2 or high by International Prognostic Scoring System (IPSS) or \>/= 10% blasts) MDS will also be eligible. All non-hematological toxicity of previous cancer therapy should have resolved to \</= grade 1 (except alopecia or other toxicities not involving major organs).
4. Eastern Cooperative Oncology Group (ECOG) performance status of \</=3 at study entry.
5. Laboratory test results within these ranges (unless due to leukemia): Serum creatinine \</= 2 mg/dL Total bilirubin \</= 2 mg/dL aspartate aminotransferase (AST) (SGOT) and/or alanine aminotransferase (ALT) (SGPT) \</= 2.5 \* upper limit of normal (ULN) or \</= 5 \* ULN if related to disease
6. Women of childbearing potential (WCBP) must have a negative urine pregnancy test within 7 days and must either commit to continued abstinence from heterosexual intercourse or adopting at least one highly effective method of contraception. These methods include intra-uterine device, tubal ligation, partner's vasectomy, hormonal birth control pills. Men must agree not to father a child and agree to use a condom if his partner is of child bearing potential.
7. Active participants of the similar Protocol 2007-0882 (preceding study of decitabine and Mylotarg) are eligible to roll-over to this protocol without meeting the inclusion or exclusion criteria for this study.
8. For patients with MF only: Diagnosis of MF requiring therapy, including those previously treated by MF-directed therapy and relapsed or refractory; or if newly diagnosed then with intermediate or high risk according to Lille scoring system (adverse prognostic factors are: hemoglobin (Hb) \< 10 g/dl, White blood cells (WBC) \< 4 or \> 30 \* 10\^9/L; risk group: 0 = low, 1 = intermediate, 2 = high), or with symptomatic splenomegaly (\>/=10cm below left mid-costal margin).
9. For patients with MF only: Performance status 0-2 (Zubrod).
10. For patients with MF only: Signed informed consent.
11. For patients with MF only: Patients must have been off MF-directed therapy for 2 weeks prior to entering this study and have recovered from the toxic effects (grade 0-1) of that therapy. Patients are allowed to enter the study if on stable dose, for at least 1 months, of anagrelide (to control high platelets) or hydroxyurea (to control high WBC or enlarging spleen), or on stable dose, for at least 2 months, of erythropoietin (for significant anemia).
12. For patients with MF only: Serum bilirubin levels \</= 2 times the upper limit of the normal range for the laboratory (ULN). Higher levels are acceptable if these can be attributed to active hemolysis or ineffective erythropoiesis, as judged by treating physician.
13. For patients with MF only: Serum glutamic-pyruvic transaminase (SGPT) (alanine aminotransferase \[ALT\]) levels \</= 2\* ULN, unless related to the MF, as judged by treating physician.
14. For patients with MF only: Serum creatinine levels \</= 2\* ULN.
15. For patients with MF only: Women of childbearing potential must have a negative serum pregnancy test prior to treatment and should be advised to avoid becoming pregnant. Men must be advised to not father a child while receiving treatment. Both women of childbearing potential and men must practice effective methods of contraception (those generally accepted as standard of care measures).
16. For patients with MF only: Age \> 18 years.

Exclusion Criteria:

1. Pregnant or breastfeeding females.
2. Any condition, including the presence of laboratory abnormalities, which places the patient at unacceptable risk.
3. Use of any other experimental drug or therapy for leukemia within 14 days unless there is clear evidence of rapid disease progression. Use of hydrea to control proliferative disease will be allowed prior to starting therapy on study and for up to 7 days each during cycle 1-3 (Maximum daily dose of 7 gm).
4. For patients with MF only: Nursing and pregnant females. Should a woman become pregnant or suspect she is pregnant while participating in this study, she should inform her treating physician immediately.
5. For patients with MF only: Uncontrolled intercurrent illness including, but not limited to, uncontrolled active infection, symptomatic congestive heart failure, unstable angina pectoris, or psychiatric illness/social situations that would limit compliance with study requirements.