The type III transforming growth factor β (TGF-β) receptor (TβRIII), also known as betaglycan, is the most abundantly expressed TGF-β receptor. TβRIII suppresses breast cancer progression by inhibiting migration, invasion, metastasis, and angiogenesis. TβRIII binds TGF-β ligands, with membrane-bound TβRIII presenting ligand to enhance TGF-β signaling. However, TβRIII can also undergo ectodomain shedding, releasing soluble TβRIII, which binds and sequesters ligand to inhibit downstream signaling. To investigate the relative contributions of soluble and membrane-bound TβRIII on TGF-β signaling and breast cancer biology, we defined TβRIII mutants with impaired (ΔShed-TβRIII) or enhanced ectodomain shedding (SS-TβRIII). Inhibiting ectodomain shedding of TβRIII increased TGF-β responsiveness and abrogated TβRIII's ability to inhibit breast cancer cell migration and invasion. Conversely, expressing SS-TβRIII, which increased soluble TβRIII production, decreased TGF-β signaling and increased TβRIII-mediated inhibition of breast cancer cell migration and invasion. Of importance, SS-TβRIII-mediated increases in soluble TβRIII production also reduced breast cancer metastasis in vivo. Taken together, these studies suggest that the ratio of soluble TβRIII to membrane-bound TβRIII is an important determinant for regulation of TβRIII- and TGF-β-mediated signaling and biology.