The activation of Ras signaling is a major early event of oncogenesis in many contexts, yet paradoxically, Ras signaling induces cellular senescence, which prevents tumorigenesis. Thus, Ras-activated cells must overcome senescence to develop into cancer. Through a genetic screen in <italic>Drosophila melanogaster</italic>, we found that the ETS family transcriptional activator Pointed (Pnt) was necessary and sufficient to trigger cellular senescence upon Ras activation and blocked Ras-induced tumor growth in eye-antennal discs. Through analyses of mosaic discs using various genetic tools, we identified a mechanism of tumor progression in which loss of cell polarity, a common driver of epithelial oncogenesis, abrogated Ras-induced cellular senescence through microRNA-mediated inhibition of Pnt. Mechanistically, polarity defects in Ras-activated cells caused activation of the Hippo effector Yorkie (Yki), which induced the expression of the microRNA <italic>bantam</italic>. <italic>bantam</italic>-mediated repression of the E3 ligase–associated protein Tribbles (Trbl) relieved Ras- and Akt-dependent inhibition of the transcription factor FoxO. The restoration of FoxO activity in Ras-activated cells induced the expression of the microRNAs <italic>miR-9c</italic> and <italic>miR-79</italic>, which led to reduced <italic>pnt</italic> expression, thereby abrogating cellular senescence and promoting tumor progression. Our findings provide a mechanistic explanation for how Ras-activated tumors progress toward malignancy by overcoming cellular senescence.