The role of HER4 in breast cancer is controversial and its role in relation to trastuzumab resistance remains unclear. We showed that trastuzumab treatment and its acquired resistance induced HER4 upregulation, cleavage and nuclear translocation. However, knockdown of HER4 by specific siRNAs increased trastuzumab sensitivity and reversed its resistance in HER2 positive breast cancer cells. Preventing HER4 cleavage by a γ-secretase inhibitor and inhibiting HER4 tyrosine kinase activity by neratinib decreased trastuzumab-induced HER4 nuclear translocation and enhanced trastuzumab response. There was also increased nuclear HER4 staining in the tumours from BT474 xenograft mice and human patients treated with trastuzumab. Furthermore, nuclear HER4 predicted poor clinical response to trastuzumab monotherapy in patients undergoing a window study and was shown to be an independent poor prognostic factor in HER2 positive breast cancer. Our data suggest that HER4 plays a key role in relation to trastuzumab resistance in HER2 positive breast cancer. Therefore, our study provides novel findings that HER4 activation, cleavage and nuclear translocation influence trastuzumab sensitivity and resistance in HER2 positive breast cancer. Nuclear HER4 could be a potential prognostic and predictive biomarker and understanding the role of HER4 may provide strategies to overcome trastuzumab resistance in HER2 positive breast cancer.