Most solid tumors harbor somatic mutations attributed to off-target activities of APOBEC3A (A3A) and/or APOBEC3B (A3B). However, how APOBEC3A/B enzymes affect tumor evolution in the presence of exogenous mutagenic processes is largely unknown. Here, multi-omics profiling of 309 lung cancers from smokers identifies two subtypes defined by low (LAS) and high (HAS) APOBEC mutagenesis. LAS are enriched for A3B-like mutagenesis and KRAS mutations; HAS for A3A-like mutagenesis and TP53 mutations. Compared to LAS, HAS have older age at onset and high proportions of newly generated progenitor-like cells likely due to the combined tobacco smoking- and APOBEC3A-associated DNA damage and apoptosis. Consistently, HAS exhibit high expression of pulmonary healing signaling pathway, stemness markers, distal cell-of-origin, more neoantigens, slower clonal expansion, but no smoking-associated genomic/epigenomic changes. With validation in 184 lung tumor samples, these findings show how heterogeneity in mutational burden across co-occurring mutational processes and cell types contributes to tumor development.