The centromere-specific histone variant CENP-A (CID in Drosophila) is a structural and functional foundation for kinetochore formation and chromosome segregation. Here, we show that overexpressed CID is mislocalized into normally noncentromeric regions in Drosophila tissue culture cells and animals. Analysis of mitoses in living and fixed cells reveals that mitotic delays, anaphase bridges, chromosome fragmentation, and cell and organismal lethality are all direct consequences of CID mislocalization. In addition, proteins that are normally restricted to endogenous kinetochores assemble at a subset of ectopic CID incorporation regions. The presence of microtubule motors and binding proteins, spindle attachments, and aberrant chromosome morphologies demonstrate that these ectopic kinetochores are functional. We conclude that CID mislocalization promotes formation of ectopic centromeres and multicentric chromosomes, which causes chromosome missegregation, aneuploidy, and growth defects. Thus, CENP-A mislocalization is one possible mechanism for genome instability during cancer progression, as well as centromere plasticity during evolution.