Cytokinesis failure may result in the formation of polyploid cells, and subsequent mitosis can lead to aneuploidy and tumor formation. Tumor suppressor mechanisms limiting the oncogenic potential of these cells have been described. However, the universal applicability of these tumor-suppressive barriers remains controversial. Here, we use Drosophila epithelial cells to investigate the consequences of cytokinesis failure in vivo. We report that cleavage defects trigger the activation of the JNK pathway, leading to downregulation of the inhibitor of apoptosis DIAP1 and programmed cell death. Yorkie overcomes the tumor-suppressive role of JNK and induces neoplasia. Yorkie regulates the cell cycle phosphatase Cdc25/string, which drives tumorigenesis in a context of cytokinesis failure. These results highlight the functional significance of the JNK pathway in epithelial cells with defective cytokinesis and elucidate a mechanism used by emerging tumor cells to bypass this tumor-suppressive barrier and develop into tumors.