Tumour cells are subjected to evolutionary selection pressures during progression from initiation to metastasis. We analysed the clonal evolution of squamous skin carcinomas induced by DMBA/TPA treatment using the K5CreER-Confetti mouse and stage-specific lineage tracing. We show that benign tumours are polyclonal, but only one population contains the Hras driver mutation. Thus, benign papillomas are monoclonal in origin but recruit neighbouring epithelial cells during growth. Papillomas that never progress to malignancy retain several distinct clones, whereas progression to carcinoma is associated with a clonal sweep. Newly generated clones within carcinomas demonstrate intratumoural invasion and clonal intermixing, often giving rise to metastases containing two or more distinct clones derived from the matched primary tumour. These data demonstrate that late-stage tumour progression and dissemination are governed by evolutionary selection pressures that operate at a multicellular level and, therefore, differ from the clonal events that drive initiation and the benign-malignant transition.