Expression of Sprouty genes is frequently decreased or absent in human prostate cancer, implicating them as suppressors of tumorigenesis. Here we show they function in prostate tumor suppression in the mouse. Concomitant inactivation of Spry1 and Spry2 in prostate epithelium causes ductal hyperplasia and low-grade prostatic intraepithelial neoplasia (PIN). However, when Spry1 and Spry2 loss-of-function occurs in the context of heterozygosity for a null allele of the tumor suppressor gene Pten, there is a striking increase in PIN and evidence of neoplastic invasion. Conversely, expression of a Spry2 gain-of-function transgene in Pten null prostatic epithelium suppresses the tumorigenic effects of loss of Pten function. We show that Sprouty gene loss-of-function results in hyperactive RAS/ERK1/2 signaling throughout the prostate epithelium and cooperates with heterozygosity for a Pten null allele to promote hyperactive PI3K/AKT signaling. Furthermore, Spry2 gain-of-function can suppress hyperactivation of AKT caused by the absence of PTEN. Together, these results point to a key genetic interaction between Sprouty genes and Pten in prostate tumorigenesis and provide strong evidence that Sprouty genes can function to modulate signaling via the RAS/ERK1/2 and PI3K/AKT pathways. The finding that Sprouty genes suppress tumorigenesis caused by Pten loss-of-function suggests that therapeutic approaches aimed at restoring normal feedback mechanisms triggered by receptor tyrosine kinase signaling, including Sprouty gene expression, may provide an effective strategy to delay or prevent high-grade PIN and invasive prostate cancer.