Cancer-associated fibroblasts (CAFs), the most abundant and probably the most active cellular component of breast cancer-associated stroma, promote carcinogenesis through paracrine effects; however, the molecular basis remains elusive. We have shown here that p16INK4A expression is reduced in 83% CAFs as compared with their normal adjacent counterparts cancer-free tissues isolated from the same patients. This decrease is mainly due to AUF1-dependent higher turnover of the CDKN2A mRNA in CAFs. Importantly, p16INK4A downregulation using specific siRNA activated breast fibroblasts and increased the expression/secretion levels of stromal cell-derived factor 1 (SDF-1) and matrix metalloproteinase (MMP)-2. Consequently, media conditioned with these cells stimulated the proliferation of epithelial cells. Furthermore, the migration/invasion of breast cancer cells was also enhanced in an SDF-1-dependent manner. This effect was mediated through inducing an epithelial–mesenchymal transition state. By contrast, increase in p16INK4A level through ectopic expression or AUF1 downregulation, reduced the secreted levels of SDF-1 and MMP-2 and suppressed the pro-carcinogenic effects of CAFs. In addition, p16INK4A-defective fibroblasts accelerated breast tumor xenograft formation and growth rate in mice. Importantly, tumors formed in the presence of p16INK4A-defective fibroblasts exhibited higher levels of active Akt, Cox-2, MMP-2 and MMP-9, showing their greater aggressiveness as compared with xenografts formed in the presence of p16INK4A-proficient fibroblasts. These results provide the first indication that p16INK4A downregulation in breast stromal fibroblasts is an important step toward their activation.