Background: Arsenic is a common environmental pollutant, chronic arsenic exposure causes multiple cancers including skin cancer. However, the underlying mechanisms of arsenic-driven skin carcinogenesis remains unclear. Methods: HaCaT cells were exposed to a low level of arsenic (100nM) for 28 weeks. Then, xenograft mouse model and H&E staining were used to test their ability of tumors formation. The effect of arsenic on apoptosis demonstrated by TUNEL assay. XIAP and cIAP1 were determined by immunocytochemistry. MMP9, p16, Cyclin D1, CDK4 and Rb were detected by Real-time PCR. The protein expression level of Cyclin D1 was detected by Western blot . The formation of autophagosome was examined by a transmission electron microscope. Results: After HaCaT cells were chronic exposed to arsenic for 28 weeks, malignant transformation occurred as evidenced by the formation of highly aggressive squamous cell carcinoma after inoculation into nude mice. In addition to increased secretion of MMP9, apoptotic resistance generalized and members of the inhibitor of apoptosis (IAP), including XIAP and cIAP1, were significantly elevated in arsenic-transformed cells (termed AS-TM). Furthermore, p16, Cyclin D1, CDK4, and Rb were significantly increased in AS-TM. The protein expression level of Cyclin D1 in AS-TM cells was significantly higher than that in control. More interesting, arsenic was found to induce autophagy after chronic arsenic exposure, heightened autophagosome release was observed in AS-TM. Conclusion: Apoptotic resistance, cell cycle dysregulation and activation of autophagy are the underlying mechanisms of arsenic-driven skin carcinogenesis, which provide new insight on the pathogenesis of arsenic-induced skin cancer.