The control of cell and organ growth is fundamental to the development of multicellular organisms. Here, we show that dPTEN, a Drosophila homolog of the mammalian PTEN tumor suppressor gene, plays an essential role in the control of cell size, cell number, and organ size. In mosaic animals, dPTEN(-) cells proliferate faster than their heterozygous siblings, show an autonomous increase in cell size, and form organs of increased size, whereas overexpression of dPTEN results in opposite phenotypes. The loss-of-function phenotypes of dPTEN are suppressed by mutations in the PI3K target Dakt1 and the translational initiation factor eif4A, suggesting that dPTEN acts through the PI3K signaling pathway to regulate translation. Although activation of PI3K and Akt has been reported to increase rates of cellular growth but not proliferation, loss of dPTEN stimulates both of these processes, suggesting that PTEN regulates overall growth through PI3K/Akt-dependent and -independent pathways. Furthermore, we show that dPTEN does not play a major role in cell survival during Drosophila development. Our results provide a potential explanation for the high frequency of PTEN mutation in human cancer.