Expression levels of the papain-like cysteine protease cathepsin B (Ctsb) have been positively correlated with mammary tumour progression and metastasis; however, its roles in the hallmark processes of malignant growth remain poorly defined. Using Ctsb-deficient mice we investigated tumour cell differentiation, proliferation and apoptosis in the Tg(MMTV-PyMT) mouse mammary cancer model. Absence of Ctsb significantly impaired development of high-grade invasive ductal carcinomas and reduced the metastatic burden in the lungs. Mice lacking Ctsb exhibited reduced cell proliferation in mammary carcinomas and their lung metastases. Notably, intravenous injection of primarily isolated, Ctsb-expressing tumour cells into congenic Ctsb-deficient mice revealed impaired cell proliferation in the resulting experimental lung metastases, providing evidence for the involvement of Ctsb in paracrine regulation of cancer cell proliferation. No Ctsb genotype-dependent difference in tumour cell death was observed in vivo or by treatment of isolated PyMT cancer cells with tumour necrosis factor-alpha. However, cancer cells lacking Ctsb exhibited significantly higher resistance to apoptosis induction by the lysosomotropic agent Leu-Leu-OMe. Thus, our results indicate an in vivo role for Ctsb in promoting cellular anaplasia in mammary cancers and proliferation in lung metastases.