To learn more about cancer-associated fibroblasts (CAFs), we have isolated fibroblasts from different stages of breast cancer progression and analysed their function and gene expression. These analyses reveal that activation of the YAP transcription factor is a signature feature of CAFs. YAP function is required for CAFs to promote matrix stiffening, cancer cell invasion and angiogenesis. Remodelling of the ECM and promotion of cancer cell invasion requires the actomyosin cytoskeleton. YAP regulates the expression of several cytoskeletal regulators, including ANLN, and DIAPH3, and controls the protein levels of MYL9/MLC2. Matrix stiffening further enhances YAP activation, thus establishing a feed-forward self-reinforcing loop that helps to maintain the CAF phenotype. Actomyosin contractility and Src function are required for YAP activation by stiff matrices. Further, transient ROCK inhibition is able to disrupt the feed-forward loop leading to a long-lasting reversion of the CAF phenotype.