Membrane-type 1 matrix metalloproteinase (MT1-MMP), a transmembrane proteinase with an extracellular catalytic domain and a short cytoplasmic tail, degrades a variety of extracellular matrix (ECM) components. In addition, MT1-MMP activates intracellular signaling through proteolysis-dependent and independent mechanisms. We have previously shown that binding of tissue inhibitor of metalloproteinases-2 (TIMP-2) to MT1-MMP controls cell proliferation and migration, as well as tumor growth in vivo by activating the Ras-extracellular signal regulated kinase-1 and -2 (ERK1/2) pathway through a mechanism that requires the cytoplasmic but not the proteolytic domain of MT1-MMP. Here we show that in MT1-MMP expressing cells TIMP-2 also induces rapid and sustained activation of AKT in a dose- and time-dependent manner and by a mechanism independent of the proteolytic activity of MT1-MMP. Fibroblast growth factor receptor-1 mediates TIMP-2 induction of ERK1/2 but not of AKT activation; however, Ras activation is necessary to transduce the TIMP-2-activated signal to both the ERK1/2 and AKT pathways. ERK1/2 and AKT activation by TIMP-2 binding to MT1-MMP protects tumor cells from apoptosis induced by serum starvation. Conversely, TIMP-2 upregulates apoptosis induced by three-dimensional type I collagen in epithelial cancer cells. Thus, TIMP-2 interaction with MT1-MMP provides tumor cells with either pro- or anti-apoptotic signaling depending on the extracellular environment and apoptotic stimulus.