Vertebrate Tob/BTG proteins inhibit cell proliferation when overexpressed in tissue-culture cells, and they can function as tumor suppressors in mice. The single Caenorhabditis elegans Tob/BTG ortholog, FOG-3, by contrast, was identified from its loss-of-function phenotype as a regulator of sperm fate specification. Here we report that FOG-3 also regulates proliferation in the germline tissue. We first demonstrate that FOG-3 is a positive regulator of germline proliferation. Thus, fog-3 null mutants possess fewer germ cells than normal, a modest but reproducible decrease observed for each of two distinct fog-3 null alleles. A similar decrease also occurred in fog-3/+ heterozygotes, again for both fog-3 alleles, revealing a haplo-insufficient effect on proliferation. Therefore, FOG-3 normally promotes proliferation, and two copies of the fog-3 gene are required for this function. We next overexpressed FOG-3 by removal of FBF, the collective term for FBF-1 and FBF-2, two nearly identical PUF RNA-binding proteins. We find that overexpressed FOG-3 blocks proliferation in fbf-1 fbf-2 mutants; whereas germ cells stop dividing and instead differentiate in fbf-1 fbf-2 double mutants, they continue to proliferate in fog-3; fbf-1 fbf-2 triple mutants. Therefore, like its vertebrate Tob/BTG cousins, overexpressed FOG-3 is 'antiproliferative'. Indeed, some fog-3; fbf-1 fbf-2 mutants possess small tumors, suggesting that FOG-3 can act as a tumor suppressor. Finally, we show that FOG-3 and FBF work together to promote tumor formation in animals carrying oncogenic Notch mutations. A similar effect was not observed when germline tumors were induced by manipulation of other regulators; therefore, this FOG-3 tumor-promoting effect is context dependent. We conclude that FOG-3 can either promote or inhibit proliferation in a manner that is sensitive to both genetic context and gene dosage. The discovery of these FOG-3 effects on proliferation has implications for our understanding of vertebrate Tob/BTG proteins and their influence on normal development and tumorigenesis.