Solid tumours are exposed to microenvironmental factors such as hypoxia that normally inhibit cell growth. However, tumour cells are capable of counteracting these signals through mechanisms that are largely unknown. Here we show that the prolyl hydroxylase PHD3 restrains tumour growth in response to microenvironmental cues through the control of EGFR. PHD3 silencing in human gliomas or genetic deletion in a murine high-grade astrocytoma model markedly promotes tumour growth and the ability of tumours to continue growing under unfavourable conditions. The growth-suppressive function of PHD3 is independent of the established PHD3 targets HIF and NF-κB and its hydroxylase activity. Instead, loss of PHD3 results in hyperphosphorylation of epidermal growth factor receptor (EGFR). Importantly, epigenetic/genetic silencing of PHD3 preferentially occurs in gliomas without EGFR amplification. Our findings reveal that PHD3 inactivation provides an alternative route of EGFR activation through which tumour cells sustain proliferative signalling even under conditions of limited oxygen availability.