PLEKHH2 is an important FERM domain containing-protein. However, the role of PLEKHH2 in human solid tumors has not been reported yet. We report that PLEKHH2 showed enhanced cytoplasmic expression in non-small cell lung cancer (NSCLC). Its overexpression was positively correlated with high TNM stage, low differentiation, lymphatic node metastasis, and poor prognosis. In A549 and H1299 cells, high expression of PLEKHH2 significantly promoted cell proliferation, migration, invasion, and increased the expression of proliferation- and invasion-related proteins. It also enhanced the phosphorylation of FAK and promoted the activity of the PI3K/AKT pathway. Immunofluorescence and co-immunoprecipitation analyses were performed to elucidate the molecular mechanism underlying PLEKHH2-mediated regulation of proliferation and invasion in lung cancer cells. Upon transfection of full length PLEKHH2 or its FERM domain, we observed enhanced binding of PLEKHH2 to β-arrestin1, whereas FAK- β-arrestin1 binding was diminished and this led to an increase in FAK phosphorylation. PLEKHH2-mutant plasmids without the FERM domain could not effectively promote its binding to β-arrestin1, activation of FAK phosphorylation, PI3K/AKT activation, or the malignant phenotype. Our findings suggested that PLEKHH2 is an important oncogene in NSCLC. PLEKHH2 binding to β-arrestin1 through the FERM domain competitively inhibits β-arrestin1 binding to FAK, which causes the dissociation of FAK from the FAK-β-arrestin1 complex. Furthermore, the dissociation of FAK promotes its autophosphorylation, activates the PI3K/AKT signaling pathway, and subsequently promotes lung cancer cell proliferation, migration, and invasion. These results provide evidence for the potential use of PLEKHH2 inhibition as an anticancer therapy.