Recent studies have shown that miR-146b is the most upregulated microRNA in thyroid cancer and has a central role in cancer progression through mechanisms that remain largely unidentified. As phosphoinositide 3-kinase/protein kinase-B (PI3K/AKT) signaling is a fundamental oncogenic driver in many thyroid cancers, we explored a potential role for miR-146b and its target genes in PI3K/AKT activation. Among the predicted target genes of miR-146b, we found the tumor-suppressor phosphatase and tensin homolog (PTEN). Constitutive overexpression of miR-146b in thyroid epithelial cell lines significantly decreased PTEN mRNA and protein levels by direct binding to its 3'-UTR. This was accompanied by PI3K/AKT hyperactivation, leading to the exclusion of FOXO1 and p27 from the nucleus and a corresponding increase in cellular proliferation. Moreover, miR-146b overexpression led to protection from apoptosis and an increased migration and invasion potential, regulating genes involved in epithelial-mesenchymal transition. Notably, with the single exception of E-cadherin expression, all of these outcomes could be reversed by PTEN coexpression. Further analysis showed that miR-146b directly inhibits E-cadherin expression through binding to its 3'-UTR. Interestingly, miR-146b inhibition in human thyroid tumor xenografts, using a synthetic and clinically amenable molecule, blocked tumor growth when delivered intratumorally. Importantly, this inhibition increased PTEN protein levels. In conclusion, our data define a novel mechanism of PI3K/AKT hyperactivation and outline a regulatory role for miR-146b in suppressing PTEN expression, a frequent observation in thyroid cancer. Both events are related to a more aggressive tumoral phenotype. Targeting miR-146b therefore represents a promising therapeutic strategy for the treatment of this disease.