Many components of the Wnt/β-catenin signaling pathway have critical functions in mammary gland development and tumor formation, yet the contribution of glycogen synthase kinase-3 (GSK-3α and GSK-3β) to mammopoiesis and oncogenesis is unclear. Here, we report that WAP-Cre-mediated deletion of GSK-3 in the mammary epithelium results in activation of Wnt/β-catenin signaling and induces mammary intraepithelial neoplasia that progresses to squamous transdifferentiation and development of adenosquamous carcinomas at 6 months. To uncover possible β-catenin-independent activities of GSK-3, we generated mammary-specific knockouts of GSK-3 and β-catenin. Squamous transdifferentiation of the mammary epithelium was largely attenuated, however, mammary epithelial cells lost the ability to form mammospheres suggesting perturbation of stem cell properties unrelated to loss of β-catenin alone. At 10 months, adenocarcinomas that developed in glands lacking GSK-3 and β-catenin displayed elevated levels of γ-catenin/plakoglobin as well as activation of the Hedgehog and Notch pathways. Collectively, these results establish the two isoforms of GSK-3 as essential integrators of multiple developmental signals that act to maintain normal mammary gland function and suppress tumorigenesis.