Carriers of mutations in the cell cycle checkpoint protein kinase ataxia telangiectasia mutated (ATM), which represent 1-2% of the general population, have an increased risk of breast cancer. However, experimental evidence that ATM deficiency contributes to human breast carcinogenesis is lacking. We report here that in MCF-10A and MCF-12A cells, which are well established normal human mammary gland epithelial cell models, partial or almost complete stable ATM silencing or pharmacological inhibition resulted in cellular transformation, genomic instability, and formation of dysplastic lesions in NOD/SCID mice. These effects did not require the activity of exogenous DNA-damaging agents and were preceded by an unsuspected and striking increase in cell proliferation also observed in primary human mammary gland epithelial cells. Increased proliferation correlated with a dramatic, transient, and proteasome-dependent reduction of p21(WAF1/CIP1) and p27(KIP1) protein levels, whereas little or no effect was observed on p21(WAF1/CIP1) or p27(KIP1) mRNAs. p21(WAF1/CIP1) silencing also increased MCF-10A cell proliferation, thus identifying p21(WAF1/CIP1) down-regulation as a mediator of the proliferative effect of ATM inhibition. Our findings provide the first experimental evidence that ATM is a human breast tumor suppressor. In addition, they mirror the sensitivity of ATM tumor suppressor function and unveil a new mechanism by which ATM might prevent human breast tumorigenesis, namely a direct inhibitory effect on the basal proliferation of normal mammary epithelial cells.