Proteolysis of extracellular matrix proteins by membrane-type 1 matrix metalloproteinase (MT1-MMP) plays a pivotal role in tumor and endothelial cell migration. In addition to its proteolytic activity, several studies indicate that the proinvasive properties of MT1-MMP also involve its short cytoplasmic domain, but the specific mechanisms mediating this function have yet to be fully elucidated. Having previously shown that the serum factor sphingosine 1-phosphate stimulates MT1-MMP promigratory function through a process that involves its cytoplasmic domain, we now extend these findings to show that this cooperative interaction is permissive to cellular migration through MT1-MMP-dependent transactivation of the epidermal growth factor receptor (EGFR). In the presence of sphingosine 1-phosphate, MT1-MMP stimulates EGFR transactivation through a process that is dependent upon the cytoplasmic domain of the enzyme but not its catalytic activity. The MT1-MMP-induced EGFR transactivation also involves G(i) protein signaling and Src activities and leads to enhanced cellular migration through downstream extracellular signal-regulated kinase activation. The present study, thus, elucidates a novel role of MT1-MMP in signaling events mediating EGFR transactivation and provides the first evidence of a crucial role of this receptor activity in MT1-MMP promigratory function. Taken together, our results suggest that the inhibition of EGFR may represent a novel target to inhibit MT1-MMP-dependent processes associated with tumor cell invasion and angiogenesis.