Ovarian cancer is the most frequent cause of cancer death among all gynecologic cancers. We demonstrate here that lysophosphatidic acid (LPA)-induced ectodomain shedding of heparin-binding EGF-like growth factor (HB-EGF) is a critical to tumor formation in ovarian cancer. We found that among the epidermal growth factor receptor (EGFR) family of growth factors, HB-EGF gene expression in cancerous tissues and HB-EGF protein levels in patients' ascites fluid were significantly elevated. The human ovarian cancer cell lines SKOV3 and RMG-1 form tumors in nude mice. Tumor formation of these cells was enhanced by exogenous expression of pro-HB-EGF and completely blocked by pro-HB-EGF gene RNA interference or by CRM197, a specific HB-EGF inhibitor. Transfection with mutant forms of HB-EGF indicated that the release of soluble HB-EGF is essential for tumor formation. LPA, which is constitutively produced by ovarian cancer cells, induced HB-EGF ectodomain shedding in SKOV3 and RMG-1 cells, resulting in the transactivation of EGFR and the downstream kinase extracellular signal-regulated kinase/mitogen-activated protein kinase. LPA-induced transactivation was abrogated by HB-EGF gene RNA interference or by CRM197. Introduction of lipid phosphate phosphohydrolase, which hydrolyzes LPA, decreased the constitutive shedding of HB-EGF, EGFR transactivation, and the tumorigenic potential of SKOV3 and RMG-1 cells. These results indicate that HB-EGF is the primary member of the EGFR family of growth factors expressed in ovarian cancer and that LPA-induced ectodomain shedding of this growth factor is a critical step in tumor formation, making HB-EGF a novel therapeutic target for ovarian cancer.