SMG1 is a member of the phosphoinositide kinase-like kinase family of proteins that includes ATM, ATR, and DNA-PK, proteins with known roles in DNA damage and cellular stress responses. SMG1 has a well-characterized role in nonsense-mediated decay as well as suggested roles in the DNA damage response, resistance to oxidative stress, regulation of hypoxic responses, and apoptosis. To understand the roles of SMG1 further, we generated a Genetrap Smg1 mouse model. Smg1 homozygous KO mice were early embryoniclethal, but Smg1 heterozygous mice showed a predisposition to a range of cancers, particularly lung and hematopoietic malignancies,as well as development of chronic inflammation. These mice did not display deficiencies in known roles of SMG1, including nonsense mediated decay. However, they showed elevated basal tissue and serum cytokine levels, indicating low-level inflammation before the development of tumors. Smg1 heterozygous mice also showed evidence of oxidative damage in tissues. These data suggest that the inflammation observed in Smg1 haploin sufficiency contributes to susceptibility to cancer and that Smg1-deficient animals represent a model of inflammation-enhanced cancer development.