Transforming growth factor beta is growth-inhibitory in non-transformed epithelial cells but becomes growth-promoting during tumorigenesis. The role of the type I and II receptors in tumorigenesis has been extensively studied, but the role of the ubiquitously expressed type III receptor (TbetaRIII) remains elusive. We developed short hairpin RNAs directed against TbetaRIII to investigate the role of this receptor in breast cancer tumorigenesis. Nontumorigenic NMuMG mouse cells stably expressing short hairpin RNA specific to mouse TbetaRIII (NM-kd) demonstrated increased cell growth, motility, and invasion as compared with control cells expressing shRNA to human TbetaRIII (NM-con). Reconstitution of TbetaRIII expression with rat TbetaRIII abrogated the increased growth and motility seen in the NM-kd cells. In addition, the NM-kd cells exhibited marked reduction in the expression of the adherens junction protein, E-cadherin. This loss of E-cadherin was due to increased NFkappaB activity that, in turn, resulted in increased expression of the transcriptional repressors of E-cadherin such as Snail, Slug, Twist, and Sip1. Finally, NMuMG cells in which TbetaRIII had been knocked down formed invasive tumors in athymic nude mice, whereas the control cells did not. These data indicate that TbetaRIII acts as a tumor suppressor in nontumorigenic mammary epithelial cells at least in part by inhibiting NFkappaB-mediated repression of E-cadherin.