Due to imperfect discrimination against ribonucleoside triphosphates by the replicative DNA polymerases, large numbers of ribonucleotides are incorporated into the eukaryotic nuclear genome during S-phase. Ribonucleotides, by far the most common DNA lesion in replicating cells, destabilize the DNA, and an evolutionarily conserved DNA repair machinery, ribonucleotide excision repair (RER), ensures ribonucleotide removal. Whereas complete lack of RER is embryonically lethal, partial loss-of-function mutations in the genes encoding subunits of RNase H2, the enzyme essential for initiation of RER, cause the SLE-related type I interferonopathy Aicardi-Goutières syndrome. Here we demonstrate that selective inactivation of RER in mouse epidermis results in spontaneous DNA damage and epidermal hyperproliferation associated with loss of hair follicle stem cells and hair follicle function. The animals developed keratinocyte intraepithelial neoplasia and invasive squamous cell carcinoma with complete penetrance, despite potent type I interferon production and skin inflammation. These results suggest that compromises to RER-mediated genome maintenance might represent an important tumor-promoting principle in human cancer.