Phenformin is a drug in the biguanide class that was previously used to treat type 2 diabetes. We have reported the antitumor activities of phenformin to enhance the efficacy of BRAF-MAPK kinase-extracellular signal-regulated kinase pathway inhibition and to inhibit myeloid-derived suppressor cells in various melanoma models. Here we demonstrate that phenformin suppresses tumor growth and promotes keratinocyte differentiation in the 7,12-dimethylbenz[a]anthracene/12-O-tetradecanoylphorbol-13-acetate two-stage skin carcinogenesis mouse model. Moreover, phenformin enhances the suspension-induced differentiation of mouse and human keratinocytes. Mechanistically, phenformin induces the nuclear translocation of NFATc1 in keratinocytes in an AMPK-dependent manner. Pharmacologic or genetic inhibition of calcineurin and NFAT signaling reverses the effects of phenformin on keratinocyte differentiation. Taken together, our study reveals an antitumor activity of phenformin to promote keratinocyte differentiation that warrants future translational efforts to repurpose phenformin for the treatment of cutaneous squamous cell carcinomas.