The type III TGF-β receptor (TβRIII) is a TGF-β co-receptor that presents ligand to the type II TGF-β receptor to initiate signaling. TβRIII also undergoes ectodomain shedding to release a soluble form (sTβRIII) that can bind ligand, sequestering it away from cell surface receptors. We have previously identified a TβRIII extracellular mutant that has enhanced ectodomain shedding ("super shedding (SS)"-TβRIII-SS). Here, we utilize TβRIII-SS to study the balance of cell surface and soluble TβRIII in the context of lung cancer. We demonstrate that expressing TβRIII-SS in lung cancer cell models induces epithelial-to-mesenchymal transition (EMT) and that these TβRIII-SS (EMT) cells are less migratory, invasive and adhesive and more resistant to gemcitabine. Moreover, TβRIII-SS (EMT) cells exhibit decreased tumorigenicity but increased growth rate in vitro and in vivo. These studies suggest that the balance of cell surface and soluble TβRIII may regulate a dichotomous role for TβRIII during cancer progression.