Deregulated HER2 is a target of many approved cancer drugs. We analyzed 111,176 patient tumors and identified recurrent mutations in HER2 transmembrane domain (TMD) and juxtamembrane domain (JMD) that include G660D, R678Q, E693K, and Q709L. Using a saturation mutagenesis screen and testing of patient-derived mutations we found several activating TMD and JMD mutations. Structural modeling and analysis showed that the TMD/JMD mutations function by improving the active dimer interface or stabilizing an activating conformation. Further, we found that HER2 G660D employed asymmetric kinase dimerization for activation and signaling. Importantly, anti-HER2 antibodies and small-molecule kinase inhibitors blocked the activity of TMD/JMD mutants. Consistent with this, a G660D germline mutant lung cancer patient showed remarkable clinical response to HER2 blockade.