To discover new tumor-suppressor genes (TSG), we developed a functional genomics approach in which immortalized but nontumorigenic cells were stably transduced with large-scale shRNA pools and tested for tumor formation in mice. Identification of shRNAs in resulting tumors revealed candidate TSGs, which were validated experimentally and by analyzing expression in human tumor samples. Using this approach, we identified 24 TSGs that were significantly downregulated in human lung squamous cell carcinomas (hLSCC). Amplification of fibroblast growth factor receptor 1 (FGFR1), which aberrantly increases FGFR signaling, is a common genetic alteration in hLSCCs. Remarkably, we found that 17 of the TSGs encode repressors of FGFR signaling. Knockdown of 14 of these TSGs transformed immortalized human bronchial epithelial cells and, in most cases, rendered them sensitive to FGFR inhibitors. Our results indicate that increased FGFR signaling promotes tumorigenesis in many hLSCCs that lack FGFR1 amplification or activating mutations.