Breast cancer is the most common cancer in women and a leading cause of death worldwide. It is characterised by disruption in cellular signalling pathways controlling proliferation, survival and migration. Protein phosphatase 2A (PP2A) is a family of trimeric serine/threonine phosphatases, each consisting of a structural, a catalytic and a regulatory subunit; that regulate numerous signalling pathways. Some PP2A complexes function as tumour suppressors; however a role for PP2A in breast cancer has not been described. Here we first examined PP2A expression in human breast tumours. Immunohistochemical analysis identified significantly reduced protein expression of the structural subunit, PP2A-A, and regulatory subunits PP2A-B55α and PP2A-B56α, in primary tumours and metastases, compared to matched normal mammary tissue. Furthermore, analysis of gene expression databases revealed a significant association between low PP2A-B55α (PPP2R2A) expression and poor outcome in breast cancer, in particular in Luminal B subtype patients. Luminal B tumours comprise ~21% of breast cancers and are associated with early relapse and poor prognosis. Thus PP2A-B55α may be a novel prognostic marker for Luminal B patients. Functionally, shRNA-mediated knockdown of PP2A-B55α in normal mammary epithelial 3D cultures induced a tumourigenic phenotype, with increased proliferation, enlarged multilobular acini and active Akt. In contrast PP2A-B55α overexpression, or pharmacological PP2A activation, inhibited breast cancer cell proliferation and survival. Thus PP2A inactivation, in particular loss of B55α, is functionally important in breast tumourigenesis. Finally, PP2A-B55α complexes play an important role in DNA damage repair, and we found B55α knockdown impaired DNA damage repair, and increased sensitivity to DNA damaging agents. This raises the exciting possibility that breast cancer patients with low PP2A-B55α may benefit from adjuvant therapy with DNA damaging agents. Together this work demonstrates the importance of PP2A as a tumour suppressor in breast cancer, and suggests that targeting PP2A is a potential therapeutic strategy for poor outcome patients.