Many cancers, including breast cancer, harbor loss-of-function mutations in the catalytic domain of phosphatase and tensin homologue deleted on chromosome 10 (PTEN) or have reduced PTEN expression through loss of heterozygosity and/or epigenetic silencing mechanisms. However, specific phenotypic effects of PTEN inactivation in human cancer cells remain poorly defined without a direct causal connection between the loss of PTEN function and the development or progression of cancer. To evaluate the biological and clinical relevance of reduced or deleted PTEN expression, a novel in vitro model system was generated using human somatic cell knockout technologies. Targeted homologous recombination allowed for a single and double allelic deletion, which resulted in reduced and deleted PTEN expression, respectively. We determined that heterozygous loss of PTEN in the nontumorigenic human mammary epithelial cell line MCF-10A was sufficient for activation of the phosphoinositide 3-kinase/AKT and mitogen-activated protein kinase pathways, whereas the homozygous absence of PTEN expression led to a further increased activation of both pathways. The deletion of PTEN was able to confer growth factor-independent proliferation, which was confirmed by the resistance of the PTEN(-/-) MCF-10A cells to small-molecule inhibitors of the epidermal growth factor receptor. However, neither heterozygous nor homozygous loss of PTEN expression was sufficient to promote anchorage-independent growth, but the loss of PTEN did confer apoptotic resistance to cell rounding and matrix detachment. Finally, MCF-10A cells with the reduction or loss of PTEN showed increased susceptibility to the chemotherapeutic drug doxorubicin but not paclitaxel.