Cellular senescence is a coordinated program activated in damaged or premalignant cells, which prevents them from further proliferation, and thereby blocks cancer development. It is now recognized that senescent cells that remain viable in tissues can have important and complex effects on a variety of diseases, and prominently contribute to aging. We aim to understand the effects of senescence on cell and tissue function during aging as well as during cancer development, and to study the potential benefits of “senolytic” drugs, which target senescent cells. Using genetically engineered mice that allow activation or prevention of senescence in different cell types, we uncovered important effects of senescence on cancer development. Accumulation of senescent cells in the epidermis stimulates premalignant lesion formation through activation of Wnt signals. In premalignant pancreatic lesions, senescent cells provide a strong pro-tumorigenic effect through Cox2-mediated inflammatory signals, stimulating division of neighboring cells. In both models, senolytic treatment was effective in blocking progression to malignancy, providing some of the first demonstrations of the potential benefit of senolytic treatment in cancer. We also studied the effects of senescence on normal cell function, specifically on pancreatic beta cells. Interestingly, in these cells senescsnece promotes functional maturation during aging. Our studies provide insights into the functions of senescent cells within tumors and their stroma, as well as in aging tissues, and highlight potential settings in which their targeting may be beneficial.