The development of pulmonary metastasis is the leading cause of death in osteosarcoma (OS), which is the most common malignant bone tumor in children. We have previously reported that the tumor suppressor p27 (KIP1, CDKN1B) is frequently mislocalized to the cytoplasm of OS. However, its prognostic significance and metastatic mechanism are still elusive. Here, we show that cytoplasmic p27 significantly correlated with a higher metastatic status and poorer survival of OS patients (n = 136, P < 0.05), highlighting the clinical significance of p27 mislocalization in OS. Mechanistically, cytoplasmic p27 is co‐immunoprecipitated with p21‐activated kinase 1 (PAK1), which resulted in higher PAK1 phosphorylations, actin polymerization, and cell motility in p27‐mislocalized OS cells. Silencing PAK1 expression in different p27‐mislocalized OS cell lines decreased the migratory and adhesion abilities in vitro, as well as the development of pulmonary metastases in vivo. Similar PAK1‐dependent motility was also observed in other p27‐mislocalized cancer cell lines. In summary, our study suggests that cytoplasmic p27‐mediated PAK1 activation is crucial for OS metastasis. A biomarker‐guided targeted therapeutic approach for metastatic OS and other cancers harboring p27 mislocalization can be developed, where cytoplasmic p27 is used for risk stratification and PAK1 can be exploited as a potential therapeutic target.