The expression of the NH2 terminally truncated ErbB2 receptor (p95ErbB2) in breast cancer correlates with metastatic disease progression compared with the expression of full-length p185ErbB2. We now show that heregulin (HRG), but not EGF, stimulates p95ErbB2 phosphorylation in BT474 breast cancer cells. Furthermore, phospho-p95ErbB2 forms heterodimers with ErbB3, but not EGFR, while p185ErbB2 heterodimerizes with both EGFR and ErbB3. The predilection of p95ErbB2 to heterodimerize with ErbB3 provides an explanation for its regulation by HRG, an ErbB3 ligand. GW572016, a reversible small molecule inhibitor of EGFR and ErbB2 tyrosine kinases, inhibits baseline p95ErbB2 phosphorylation in BT474 cells and tumor xenografts. Inhibition of p95ErbB2, p185ErbB2, and EGFR phosphorylation by GW572016 resulted in the inhibition of downstream phospho-Erk1/2, phospho-AKT, and cyclin D steady-state protein levels. Increased phosphorylation of p95ErbB2 and AKT in response to HRG was abrogated to varying degrees by GW572016. In contrast, trastuzumab did not inhibit p95ErbB2 phosphorylation or the expression of downstream phospho-Erk1/2, phospho-AKT, or cyclin D. It is tempting to speculate that trastuzumab resistance may be mediated in part by the selection of p95ErbB2-expressing breast cancer cells capable of exerting potent growth and prosurvival signals through p95ErbB2-ErbB3 heterodimers. Thus, p95ErbB2 represents a target for therapeutic intervention, and one that is sensitive to GW572016 therapy.