Dual EGFR/erbB2 inhibition is an attractive therapeutic strategy for epithelial tumors, as ligand-induced erbB2/EGFR heterodimerization triggers potent proliferative and survival signals. Here we show that a small molecule, GW572016, potently inhibits both EGFR and erbB2 tyrosine kinases leading to growth arrest and/or apoptosis in EGFR and erbB2-dependent tumor cell lines. GW572016 markedly reduced tyrosine phosphorylation of EGFR and erbB2, and inhibited activation of Erk1/2 and AKT, downstream effectors of proliferation and cell survival, respectively. Complete inhibition of activated AKT in erbB2 overexpressing cells correlated with a 23-fold increase in apoptosis compared with vehicle controls. EGF, often elevated in cancer patients, did not reverse the inhibitory effects of GW572016. These observations were reproduced in vivo, where GW572016 treatment inhibited activation of EGFR, erbB2, Erk1/2 and AKT in human tumor xenografts. Erk1/2 and AKT represent potential biomarkers to assess the clinical activity of GW572016. Inhibition of activated AKT in EGFR or erbB2-dependent tumors by GW572016 may lead to tumor regressions when used as a monotherapy, or may enhance the anti-tumor activity of chemotherapeutics, since constitutive activation of AKT has been linked to chemo-resistance.