Intercellular communication plays an important role during development and cancer. In mammalian testis, proper communication between somatic and germ cells is essential for normal germ cell development and differentiation. Previously, I have shown that sustained activation of canonical WNT/β-catenin signaling in testicular somatic cells causes premature germ cell loss and Sertoli cell-only seminiferous tubules, a phenotype that resembles human Sertoli cell only syndrome. However, dysregulated WNT/β-catenin unable to induces tumorigenesis in mutant testes unless deletion of a tumor suppressor, such as PTEN, was also performed. Müllerian inhibiting substance (MIS), a member of the TGFβ family of growth factors responsible for Müllerian duct regression in fetal males, has been shown to inhibit tumor growth in vitro and in vivo but its role as an endogenous tumor suppressor has never been reported. Sertoli cells in MISr2Cre/+;Ctnnb1Δ(ex3)/+ testes continue to proliferate and express higher levels of MIS, but no proliferation and very low expression of MIS was observed in control Sertoli cells. We hypothesized that the lack of testicular somatic cell carcinogenesis is because of the high levels of MIS expression, acting as a potent tumor suppressor in this setting, and that loss of MIS signaling in the MISr2Cre/+;Ctnnb1Δ(ex3)/+ mice would result in testicular carcinogenesis. Here, we have deleted the MIS type 2 receptor (MISR2), and thus MIS signaling, in mice with dysregulated WNT/β-catenin and show that these mice develop testicular stromal tumors with 100% penetrance within a few months postnatal. The tumors are highly proliferative and have characteristics of either Sertoli cell tumors or progenitor Leydig cell tumors based on their marker profiles and histology. Phosphorylated SMAD1/5/8 is absent in the tumors and β-catenin target genes are induced. The tumor suppressor TP53 is also highly expressed in the tumors, as is phosphorylated γH2AX, which is indicative of DNA damage. The phenotype of these tumors closely resembles those observed when PTEN is also deleted or Kras is acivated in mice with dysregulated WNT/β-catenin. These studies show that endogenous paracrine MIS signaling alone can silence the oncogenic activity of β-catenin to induce tumorigenesis.