We identified the IIIb C2 epithelial cell-specific splice variant of fibroblast growth factor receptor 2 (FGFR2 IIIb C2) receptor tyrosine kinase in a screen for activated oncogenes expressed in T-47D human breast carcinoma cells. We found FGFR2 IIIb C2 expression in breast carcinoma cell lines and, additionally, expression of the mesenchymal-specific FGFR2 IIIc splice variant in invasive breast carcinomas. FGFR2 IIIc expression was associated with loss of epithelial markers and gain of mesenchymal markers. Although FGFR2 IIIb is expressed in epithelial cells, previous studies on FGFR2 IIIb transformation have focused on NIH 3T3 fibroblasts. Therefore, we compared the transforming activities of FGFR2 IIIb C2 in RIE-1 intestinal cells and several mammary epithelial cells. FGFR2 IIIb C2 caused growth transformation of epithelial cells but morphologic transformation of only NIH 3T3 cells. FGFR2 IIIb C2-transformed NIH 3T3, but not RIE-1 cells, showed persistent activation of Ras and increased cyclin D1 protein expression. NIH 3T3 but not RIE-1 cells express keratinocyte growth factor, a ligand for FGFR2 IIIb C2. Ectopic treatment with keratinocyte growth factor caused FGFR2 IIIb C2-dependent morphologic transformation of RIE-1 cells, as well as cyclin D1 up-regulation, indicating that both ligand-independent and stromal cell-derived, ligand-dependent mechanisms contribute to RIE-1 cell transformation. Our results support cell context distinct mechanisms of FGFR2 IIIb C2 transformation.