MicroRNA 21 (miR-21) is overexpressed in virtually all types of carcinomas and various types of hematological malignancies. To determine whether miR-21 promotes tumor development in vivo, we knocked out the miR-21 allele in mice. In response to the 7,12-dimethylbenz[a]anthracene (DMBA)/12-O-tetradecanoylphorbol-13-acetate mouse skin carcinogenesis protocol, miR-21-null mice showed a significant reduction in papilloma formation compared with wild-type mice. We revealed that cellular apoptosis was elevated and cell proliferation was decreased in mice deficient of miR-21 compared to wild-type animals. In addition, we found that a large number of validated or predicted miR-21 target genes were up-regulated in miR-21-null keratinocytes, which are precursor cells to skin papillomas. Specifically, up-regulation of Spry1, Pten, and Pdcd4 when miR-21 was ablated coincided with reduced phosphorylation of ERK, AKT, and JNK, three major downstream effectors of Ras activation that plays a predominant role in DMBA-initiated skin carcinogenesis. These results provide in vivo evidence that miR-21 exerts its oncogenic function through negatively regulating its target genes.