Association of matrix metalloprotease 9 (MMP9) to the cell membrane is considered important in tumor growth and angiogenesis. To dissect this regulatory mechanism, we generated raft and non-raft MMP9 chimeras to force membrane expression in the MCF-7 human breast carcinoma cell line. MMP9 targeting to non-raft cell surface domains rendered a constitutive active membrane MMP9 form, suggesting a contribution by the lipid environment in MMP activation. We generated human breast cancer xenograft models using MCF-7 cells overexpressing secreted and membrane-anchored MMP9. The non-raft MMP9 chimera was constitutively active at the cell membrane in xenografts, but this activation did not correlate with an increase in MMP9-induced angiogenesis. Capillary number and vessel perimeter were specifically increased only in tumors overexpressing wild-type MMP9 (the secreted form); this increase was inhibited when tumors were induced in doxycycline-treated mice. Xenografts from tumor cells overexpressing wild-type MMP9 showed increased vascular endothelial growth factor (VEGF)/VEGFR2 receptor association, which was also dependent on MMP9 activity. These observations indicate that membrane location can influence MMP9 activity in vitro and in vivo, and confirm the relevance of stromal-associated, but not tumor-bound MMP9 in mediating tumor-induced angiogenesis.