Targeting of tumor immune escape mechanisms holds enormous therapeutic potential. Still, most patients progress under immune checkpoint blockade and some even become hyperprogressors. To investigate how cancer cells respond to activated but ineffective T cells, we challenged peptide-loaded MCF-7 breast cancer cells with antigen-specific CD8+ T cells in which lytic granules had been destroyed by pretreatment with Concanamycin A. Gene expression analysis after coculture revealed simultaneous induction of PD-L1, IDO1, CEACAM1, and further immunoregulatory checkpoints in breast cancer cells. Strikingly, we further observed gene signatures characteristic for dedifferentiation and acquisition of pluripotency markers including Yamanaka factors. Cognate interaction with nonlytic CD8+ T cells also increased the proportion of stem cell–like cancer cells in a cell-to-cell contact- or (at least) proximity-dependent manner in various cell lines and in primary breast cancer cell cultures; this induction of stem cell–like properties was confirmed by enhanced tumor-forming capacity in immunodeficient mice. Resulting tumors were characterized by enhanced cell density, higher proliferation rates, and increased propensity for lymphoid metastasis. These findings describe a widely underappreciated pathway for immune escape, namely immune-mediated dedifferentiation of breast cancer cells, which is associated with profound changes in gene expression and cellular behavior. As the enhanced malignant potential of cancer cells after nonlytic cognate interactions with CD8+ T cells enables increased tumor growth and metastasis in BALB/cnu/nu mice, the described mechanism may provide a possible explanation for the clinical phenomenon of hyperprogression in response to unsuccessful immunotherapy.Significance:This study shows that ineffective immune responses not only fail to clear a malignancy, but can also activate pathways in cancer cells that promote stemness and tumor-seeding capacity.