In many mouse models of skin cancer, only a few tumors typically form even though many cells competent for tumorigenesis receive the same oncogenic stimuli. These observations suggest an active selection process for tumor-initiating cells. Here, we use quantitative mRNA- and miR-Seq to determine the impact of Hras(G12V) on the transcriptome of keratinocytes. We discover that microRNA-203 is downregulated by Hras(G12V). Using a knockout mouse model, we demonstrate that loss of microRNA-203 promotes selection and expansion of tumor-initiating cells. Conversely, restoration of microRNA-203 using an inducible model potently inhibits proliferation of these cells. We comprehensively identify microRNA-203 targets required for Hras-initiated tumorigenesis. These targets include critical regulators of the Ras pathway and essential genes required for cell division. This study establishes a role for the loss of microRNA-203 in promoting selection and expansion of Hras mutated cells and identifies a mechanism through which microRNA-203 antagonizes Hras-mediated tumorigenesis.