Elucidating signaling events between tumor cells and their microenvironment is a major challenge in understanding cancer development. Drosophila melanogaster has emerged as an important tool for dissecting the genetic circuits tumors depend on because their imaginal discs, simple epithelia present in the larva, can be genetically manipulated to serve as models to study cancer mechanisms. Imaginal disc cells mutant for the tumor-suppressor gene scribble (scrib) lose apical-basal polarity and have the potential to form large neoplastic tumors. Interestingly, when scrib mutant (scrib(-)) cells are surrounded by normal cells the scrib(-) population is eliminated. However, the signals and mechanisms that cause the elimination of clones of scrib(-) cells are poorly understood. Here, we analyzed the role of Stat, a component of the JAK/STAT signaling pathway, in tissues with clones of scrib(-) cells. We found that Stat activity is required in normal cells for the elimination of neighboring scrib(-) cells. Importantly, these competitive defects of stat mutant cells are not simply due to defects in cell proliferation because even stat(-) cells manipulated to hyperproliferate are unable to eliminate scrib(-) cells. These data identify Stat activity as a critical determinant of whether or not a tissue can eliminate abnormal cells and provide an important step forward in understanding the complex network of signals operating in and around tumorigenic cells.Oncogene advance online publication, 29 October 2012; doi:10.1038/onc.2012.476.