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Tumor evolution from a single cell into a malignant, heterogeneous tissue remains poorly understood. Here, we profile single-cell transcriptomes of genetically engineered mouse lung tumors at seven stages, from pre-neoplastic hyperplasia to adenocarcinoma. The diversity of transcriptional states increases over time and is reproducible across tumors and mice. Cancer cells progressively adopt alternate lineage identities, computationally predicted to be mediated through a common transitional, high-plasticity cell state (HPCS). Accordingly, HPCS cells prospectively isolated from mouse tumors and human patient-derived xenografts display high capacity for differentiation and proliferation. The HPCS program is associated with poor survival across human cancers and demonstrates chemoresistance in mice. Our study reveals a central principle underpinning intra-tumoral heterogeneity and motivates therapeutic targeting of the HPCS. • Lung cancer progression is accompanied by a stereotypic expansion of heterogeneity • Cell state heterogeneity arises largely independently of genetic variation • State transitions occur via an HPCS harboring high differentiation and growth capacity • The HPCS is drug resistant and portends poor patient survival across all cancers Cellular states capable of promoting tumor progression and resisting therapies exist in heterogeneous tumors. Marjanovic et al. discover that a high-plasticity cell state common to mouse and human lung tumors drives cellular heterogeneity, is highly tumorigenic and drug resistant, and associates with poor patient prognosis. [ABSTRACT FROM AUTHOR]