Oncosomes have recently been described as membrane-derived microvesicles secreted by cancer cells, which transfer oncogenic signals and protein complexes across cell boundaries. Here, we show the rapid formation and secretion of oncosomes from DU145 and LNCaP human prostate cancer cells. Oncosome formation was stimulated by epidermal growth factor receptor activation and also by overexpression of membrane-targeted Akt1. Microvesicles shed from prostate cancer cells contained numerous signal transduction proteins and were capable of activating rapid phospho-tyrosine and Akt pathway signaling, and stimulating proliferation and migration, in recipient tumor cells. They also induced a stromal reaction in recipient normal cells. Knockdown of the actin nucleating protein Diaphanous Related Formin 3 (DRF3/Dia2) by RNA interference enhanced rates of oncosome formation, indicating that these structures resemble, and may be identical to, nonapoptotic membrane blebs, a feature of the amoeboid form of cell motility. Analysis of primary and metastatic human prostate tumors using 100K single nucleotide polymorphism arrays revealed a significantly higher frequency of deletion of the locus encoding DRF3 (DIAPH3) in metastatic tumors (P = 0.001) in comparison with organ-confined tumors. Fluorescence in situ hybridization confirmed increased chromosomal loss of DIAPH3 in metastatic tumors in a different cohort of patients (P = 0.006). These data suggest that microvesicles shed from prostate cancer cells can alter the tumor microenvironment in a manner that may promote disease progression. They also show that DRF3 is a physiologically relevant protein that seems to regulate this process.