Cyclin D1 is a proto-oncogene that functions by inactivation of the retinoblastoma tumor suppressor protein, RB. A common polymorphism in the cyclin D1 gene is associated with the production of an alternate transcript of cyclin D1, termed cyclin D1b. Both the polymorphism and the variant transcript are associated with increased risk for multiple cancers and the severity of a given cancer; however, the underlying activities of cyclin D1b have not been elucidated relative to the canonical cyclin D1a. Because cyclin D1b does not possess the threonine 286 phosphorylation site required for nuclear export and regulated degradation, it has been hypothesized to encode a stable nuclear protein that would constitutively inactivate the RB pathway. Surprisingly, we find that cyclin D1b protein does not inappropriately accumulate in cells and exhibits stability comparable to cyclin D1a. As expected, the cyclin D1b protein was constitutively localized in the nucleus, whereas cyclin D1a was exported to the cytoplasm in S-phase. Despite enhanced nuclear localization, we find that cyclin D1b is a poor catalyst of RB phosphorylation/inactivation. However, cyclin D1b potently induced cellular transformation in contrast to cyclin D1a. In summary, we demonstrate that cyclin D1b specifically disrupts contact inhibition in a manner distinct from cyclin D1a. These data reveal novel roles for d-type cyclins in tumorigenesis.