Although lung cancer is the leading cause of cancer death worldwide, the precise molecular mechanisms that give rise to lung cancer are incompletely understood. Here, we show that HMGA1 is an important oncogene that drives transformation in undifferentiated, large-cell carcinoma. First, we show that the HMGA1 gene is overexpressed in lung cancer cell lines and primary human lung tumors. Forced overexpression of HMGA1 induces a transformed phenotype with anchorage-independent cell growth in cultured lung cells derived from normal tissue. Conversely, inhibiting HMGA1 expression blocks anchorage-independent cell growth in the H1299 metastatic, undifferentiated, large-cell human lung carcinoma cells. We also show that the matrix metalloproteinase-2 (MMP-2) gene is a downstream target upregulated by HMGA1 in large-cell carcinoma cells. In chromatin immunoprecipitation experiments, HMGA1 binds directly to the MMP-2 promoter in vivo in large-cell lung cancer cells, but not in squamous cell carcinoma cells. In large-cell carcinoma cell lines, there is a significant, positive correlation between HMGA1 and MMP-2 mRNA. Moreover, interfering with MMP-2 expression blocks anchorage-independent cell growth in H1299 large-cell carcinoma cells, indicating that the HMGA1-MMP-2 pathway is required for this transformation phenotype in these cells. Blocking MMP-2 expression also inhibits migration and invasion in the H1299 large-cell carcinoma cells. Our findings suggest an important role for MMP-2 in transformation mediated by HMGA1 in large-cell, undifferentiated lung carcinoma and support the development of strategies to target this pathway in selected tumors.