Although the etiology of squamous cell carcinomas of the oral mucosa is well understood, the cellular origin and the exact molecular mechanisms leading to their formation are not. Previously, we observed the coordinated loss of E-cadherin (CDH1) and transforming growth factor beta receptor II (TGFBR2) in esophageal squamous tumors. To investigate if the coordinated loss of Cdh1 and Tgfbr2 is sufficient to induce tumorigenesis in vivo, we developed two mouse models targeting ablation of both genes constitutively or inducibly in the oral-esophageal epithelium. We show that the loss of both Cdh1 and Tgfbr2 in both models is sufficient to induce squamous cell carcinomas with animals succumbing to the invasive disease by 18 months of age. Advanced tumors have the ability to invade regional lymph nodes and to establish distant pulmonary metastasis. The mouse tumors showed molecular characteristics of human tumors such as overexpression of Cyclin D1. We addressed the question whether TGFβ signaling may target known stem cell markers and thereby influence tumorigenesis. From our mouse and human models, we conclude that TGFβ signaling regulates key aspects of stemness and quiescence in vitro and in vivo. This provides a new explanation for the importance of TGFβ in mucosal homeostasis.