OBJECTIVES: I. Determine the complete remission (CR) rate following 1 or 2 courses of ICE (idarubicin/cytarabine/etoposide) vs. MICE (mitoxantrone/cytarabine/etoposide) vs. DCE (daunorubicin/cytarabine/etoposide) in patients with newly diagnosed acute myeloid leukemia. II. Compare disease-free survival and overall survival achieved with each anthracycline on the above induction regimens and with intermediate-dose cytarabine (IDIA vs. NOVIA vs. DIA) as consolidation therapy. III. Compare disease-free survival, relapse rate, death in first CR, and overall survival in patients who receive peripheral blood stem cells (PBSC) vs. autologous bone marrow transplant (AuBMT) vs. allogeneic bone marrow transplant (AlBMT) as rescue from myeloablative therapy following remission consolidation. IV. Assess the time to recovery of normal or acceptable polymorphonuclear leukocyte and platelet counts following each treatment step. V. Determine the incidence and type of grade 4 toxicity and treatment-related mortality. VI. Evaluate the quality of life during each step of treatment using self-administered questionnaires. VII. Compare stem cell mobilization after IDIA vs. NOVIA vs. DIA, each using granulocyte colony-stimulating factor as the mobilizing growth factor. VIII. Assess the rate of completion of stem cell transplantation using PBSC vs. AlBMT vs. AuBMT as the last step of therapy. IX. Compare the costs of treatment (e.g., antibiotics and transfusion requirements) and hospitalization duration between the AuBMT vs. PBSC.