Recent evidence supports a role for EphB receptor tyrosine kinases as tumour suppressors in colorectal and prostate cancer. However, it is unclear how these receptors inhibit cancer cell tumorigenicity — an activity that is highly unusual for a family of receptor tyrosine kinases. Here, we report that the EphB4 receptor can behave as a tumour suppressor in a mouse xenograft model of breast cancer when stimulated by its ligand, ephrin-B2. In breast cancer cells, EphB4 activates an antioncogenic pathway involving Abl family tyrosine kinases and the Crk adaptor protein. This Abl–Crk pathway inhibits breast cancer cell viability and proliferation in addition to motility and invasion, and also downregulates the pro-invasive matrix metalloprotease, MMP-2. Consistent with these effects, EphB4 and the Abl–Crk pathway are constitutively active in non-transformed mammary epithelial cells. These findings identify a novel Eph receptor signalling pathway with tumour-suppressor activity and predict that therapeutic intervention to activate EphB4 signalling will inhibit tumour progression.