Although PTEN/Akt signaling is frequently deregulated in human gastric cancers, the in vivo causal link between its dysregulation and gastric tumorigenesis has not been established. Here we show that inactivation of PTEN in mouse gastric epithelium initiates spontaneous carcinogenesis with complete penetrance by 2 months of age. Mechanistically, activation of Akt suppresses the abundance of p53, leading to decreased transcription of miR-365, thus causing upregulation of cyclin D1 and cdc25A, which promotes gastric cell proliferation. Importantly, genetic ablation of Akt1 restores miR-365 expression and effectively rescues gastric tumorigenesis in PTEN-mutant mice. Moreover, orthotopic restoration of miR-365 represses PTEN-deficient-induced hyperplasia. In human gastric cancer tissues, miR-365 reduction correlates with poorly differentiated histology, deep invasion and advanced stage, as well as the deregulation of PTEN, phosphorylated Akt, p53, cyclin D1 and cdc25A. These data demonstrate that the PTEN-Akt-p53-miR-365-cyclin D1/cdc25A axis serves as a new mechanism underlying gastric tumorigenesis, providing potential new therapeutic targets.