VEGF-C and VEGF-D were identified as lymphangiogenic growth factors and later shown to promote tumor metastasis, but their effects on carcinogenesis are poorly understood. Here, we have studied the effects of VEGF-C and VEGF-D on tumor development in the murine multistep chemical carcinogenesis model of squamous cell carcinoma by using a soluble VEGF-C/VEGF-D inhibitor. After topical treatment with a tumor initiator and repeated tumor promoter applications, transgenic mice expressing a soluble VEGF-C/VEGF-D receptor (sVEGFR-3) in the skin developed significantly fewer squamous cell tumors with a delayed onset when compared with wild-type mice or mice expressing sVEGFR-3 lacking the ligand-binding site. Epidermal proliferation was reduced in the carcinogen-treated transgenic skin, whereas epidermal keratinocyte proliferation in vitro was not affected by VEGF-C or VEGF-D, indicating indirect effects of sVEGFR-3 expression. Importantly, transgenic mouse skin was less sensitive to tumor promoter–induced inflammation, with reduced angiogenesis and blood vessel leakage. Cutaneous leukocytes, especially macrophages, were reduced in transgenic skin without major changes in macrophage polarization or blood monocyte numbers. Several macrophage-associated cytokines were also reduced in transgenic papillomas, although the dermal macrophages themselves did not express VEGFR-3. These findings indicate that VEGF-C/VEGF-D are involved in shaping the inflammatory tumor microenvironment that regulates early tumor progression. Our results support the use of VEGF-C/VEGF-D–blocking agents not only to inhibit metastatic progression, but also during the early stages of tumor growth. Cancer Res; 73(14); 4212–21. ©2013 AACR.