As cancer cells traverse collagen-rich extracellular matrix (ECM) barriers and intravasate, they adopt a fibroblast-like phenotype and engage undefined proteolytic cascades that mediate invasive activity. Herein, we find that fibroblasts and cancer cells express an indistinguishable pericellular collagenolytic activity that allows them to traverse the ECM. Using fibroblasts isolated from gene-targeted mice, a matrix metalloproteinase (MMP)-dependent activity is identified that drives invasion independently of plasminogen, the gelatinase A/TIMP-2 axis, gelatinase B, collagenase-3, collagenase-2, or stromelysin-1. In contrast, deleting or suppressing expression of the membrane-tethered MMP, MT1-MMP, in fibroblasts or tumor cells results in a loss of collagenolytic and invasive activity in vitro or in vivo. Thus, MT1-MMP serves as the major cell-associated proteinase necessary to confer normal or neoplastic cells with invasive activity.