Membrane-type I matrix metalloproteinase (MT1-MMP) is associated with multiple forms of cancer including mammary cancer. To directly evaluate the significance of MT1-MMP expression in tumor progression and metastasis using a genetically induced cancer model, we crossed MT1-MMP-deficient mice to MMTV-polyoma virus middle T-antigen (PyMT) mice. Expression of PyMT in the MT1-MMP-deficient background consistently resulted in hyperplasia of the mammary gland as seen in wild-type PyMT littermates. Following orthotopic transplantation of PyMT+ glands into the cleared mammary fat pad of syngeneic recipient mice, MT1-MMP-deficient tumors were palpable earlier than wild-type tumors. Moreover, MT1-MMP-deficient tumors grew to the experimental end point size quicker than control tumors, but demonstrated markedly reduced ability to metastasize to the lungs of recipient mice. Accordingly, MT1-MMP-deficient mice displayed an overall reduction in metastasis count of 50%. MT1-MMP was expressed solely in the stroma of PyMT-induced tumors and those metastatic nodules that formed in the lungs were devoid of MT1-MMP expression. Stromal fibroblasts isolated from MT1-MMP-deficient tumors did not degrade type I collagen suggesting that efficient dissemination of tumor cells is dependent on stromal cell remodeling of the tumor environment. The data demonstrate directly that MT1-MMP-mediated proteolysis by stromal cells is important in the metastatic process.