Previously, our lab discovered the protein Nischarin and uncovered its role in regulating cell migration and invasion via its interactions with several proteins. We subsequently described a role for Nischarin in breast cancer, in which it is frequently underexpressed. To characterize Nischarin's role in breast tumorigenesis and mammary gland development more completely, we deleted a critical region of the Nisch gene (exons 7–10) from the mouse genome and observed the effects. Mammary glands in mutant animals showed delayed terminal end bud formation but did not develop breast tumors spontaneously. Therefore, we interbred the animals with transgenic mice expressing the mouse mammary tumor virus‐polyoma middle T‐antigen (MMTV‐PyMT) oncogene. The MMTV‐PyMT mammary glands lacking Nischarin showed increased hyperplasia compared to wild‐type animal tissues. Furthermore, we observed significantly increased tumor growth and metastasis in Nischarin mutant animals. Surprisingly, Nischarin deletion decreased activity of AMPK and subsequently its downstream effectors. Given this finding, we treated these animals with metformin, which enhances AMPK activity. Here, we show for the first time, metformin activates AMPK signaling and inhibits tumor growth of Nischarin lacking PyMT tumors suggesting a potential use for metformin as a cancer therapeutic, particularly in the case of Nischarin‐deficient breast cancers.