Activation of the PI3K-AKT signaling cascade is a common critical event during malignant transformation. In this study, we used thyroid gland epithelial cells and a series of genetically engineered mouse strains as model systems to demonstrate that, although necessary, AKT activation is not sufficient for PI3K-driven transformation. Instead, transformation requires the activity of the PDK1-regulated AGC family of protein kinases. In particular, SGK1 was found to be essential for proliferation and survival of thyroid cancer cells harboring PI3K-activating mutations. Notably, cotargeting SGK1 and AKT resulted in significantly higher growth suppression than inhibiting either PI3K or AKT alone. Overall, these findings underscore the clinical relevance of AKT-independent pathways in tumors driven by genetic lesions targeting the PI3K cascade. Cancer Res; 77(24); 6914-26. ©2017 AACR.