Epithelial tissues robustly respond to internal and external stressors via dynamic cellular rearrangements. Cell extrusion acts as a key regulator of epithelial homeostasis by removing apoptotic cells, orchestrating morphogenesis, and mediating competitive cellular battles during tumorigenesis. Here, we delineate the diverse functions of cell extrusion during development and disease. We emphasize the expanding role for apoptotic cell extrusion in exerting morphogenetic forces, as well as the strong intersection of cell extrusion with cell competition, a homeostatic mechanism that eliminates aberrant or unfit cells. While cell competition and extrusion can exert potent, tumor-suppressive effects, dysregulation of either critical homeostatic program can fuel cancer progression.