PKN2, a member of the protein kinase N (PKN) family, has been suggested by in vitro culture cell experiments to bind to Rho/Rac GTPases and contributes to cell–cell contact and cell migration. To unravel the in vivo physiological function of PKN2, we targeted the PKN2 gene. Constitutive disruption of the mouse PKN2 gene resulted in growth retardation and lethality before embryonic day (E) 10.5. PKN2^−/− embryo did not undergo axial turning and showed insufficient closure of the neural tube. Mouse embryonic fibroblasts (MEFs) derived from PKN2^−/− embryos at E9.5 failed to grow. Cre‐mediated ablation of PKN2 in PKN2^flox/flox MEFs obtained from E14.5 embryos showed impaired cell proliferation, and cell cycle analysis of these MEFs showed a decrease in S‐phase population. Our results show that PKN2 is essential for mouse embryonic development and cell‐autonomous proliferation of primary MEFs in culture. Comparison of the PKN2^−/− phenotype with the phenotypes of PKN1 and PKN3 knockout strains suggests that PKN2 has distinct nonredundant functions in vivo, despite the structural similarity and evolutionary relationship among the three isoforms.