B7-H4 protein is expressed on the surface of a variety of immune cells and functions as a negative regulator of T cell responses. We independently identified B7-H4 (DD-O110) through a genomic effort to discover genes upregulated in tumors and here we describe a new functional role for B7-H4 protein in cancer. We show that B7-H4 mRNA and protein are overexpressed in human serous ovarian cancers and breast cancers with relatively little or no expression in normal tissues. B7-H4 protein is extensively glycosylated and displayed on the surface of tumor cells and we provide the first demonstration of a direct role for B7-H4 in promoting malignant transformation of epithelial cells. Overexpression of B7-H4 in a human ovarian cancer cell line with little endogenous B7-H4 expression increased tumor formation in SCID mice. Whereas overexpression of B7-H4 protected epithelial cells from anoikis, siRNA-mediated knockdown of B7-H4 mRNA and protein expression in a breast cancer cell line increased caspase activity and apoptosis. The restricted normal tissue distribution of B7-H4, its overexpression in a majority of breast and ovarian cancers and functional activity in transformation validate this cell surface protein as a new target for therapeutic intervention. A therapeutic antibody strategy aimed at B7-H4 could offer an exciting opportunity to inhibit the growth and progression of human ovarian and breast cancers.