Cigarette smoking (CS) is one of the greatest health concerns, which can cause lung cancer. 4-(Methylnitrosamino)-1-(3-pyridyl)-1-butanone (NNK), a tobacco-specific nitrosamine, has been well-documented for its carcinogenic activity in both epidemiological and laboratory studies. PH domain leucine-rich repeat protein phosphatase 1 (PHLPP1) and phosphatase and tensin homolog (PTEN) are two well-known phosphatase tumor suppressors that have been reported to be downregulated in human lung cancer tissues. However, the effect of NNK exposure on the expression of PHLPP1 and PTEN is unknown, and such effects may be early events leading to lung carcinogenesis. We explored this question in current studies and found that exposure of human bronchial epithelial BEP2D cells to NNK resulted in cell malignant transformation accompanied by a remarkable downregulation of PHLPP1 and PTEN. Such downregulation of PHLPP1 and PTEN was also consistently observed in vivo in Cigarette Smoking-exposed mouse lung tissues. Our studies further showed that overexpression of PHLPP1 or PTEN alleviated NNK-induced BEP2D cell transformation. Ectopic expression of PHLPP1 promoted PTEN protein expression, while PTEN overexpression did not affect PHLPP1 expression. Mechanistic studies showed that NNK was able to inhibit PP2A-C activity, which directly attenuated c-Jun phosphorylation at Ser63/73, and subsequently inhibited the PHLPP1 transcription and expression. Further, the downregulation of PHLPP1 led to a reduction of pten mRNA stability and expression through the HUR/Jun D/miR-613/NCL axis. Taken together, our studies advance the field of tobacco-induced lung cancer research by uncovering new mechanistic insights and identifying a novel molecular axis that could inform future therapeutic strategies. It also adds a new dimension by exploring the interaction between PHLPP1 and PTEN in the context of tobacco carcinogen exposure.