The receptor tyrosine kinase HER2 is overexpressed in approximately 20% of breast cancer, and its amplification is associated with reduced survival. Trastuzumab emtansine (Kadcyla, T-DM1), an antibody–drug conjugate that is comprised of trastuzumab covalently linked to the antimitotic agent DM1 through a stable linker, was designed to selectively deliver DM1 to HER2-overexpressing tumor cells. T-DM1 is approved for the treatment of patients with HER2-positive metastatic breast cancer following progression on trastuzumab and a taxane. Despite the improvement in clinical outcome, many patients who initially respond to T-DM1 treatment eventually develop progressive disease. The mechanisms that contribute to T-DM1 resistance are not fully understood. To this end, we developed T-DM1–resistant in vitro models to examine the mechanisms of acquired T-DM1 resistance. We demonstrate that decreased HER2 and upregulation of MDR1 contribute to T-DM1 resistance in KPL-4 T-DM1–resistant cells. In contrast, both loss of SLC46A3 and PTEN deficiency play a role in conferring resistance in BT-474M1 T-DM1–resistant cells. Our data suggest that these two cell lines acquire resistance through distinct mechanisms. Furthermore, we show that the KPL-4 T-DM1 resistance can be overcome by treatment with an inhibitor of MDR1, whereas a PI3K inhibitor can rescue PTEN loss–induced resistance in T-DM1–resistant BT-474M1 cells. Our results provide a rationale for developing therapeutic strategies to enhance T-DM1 clinical efficacy by combining T-DM1 and other inhibitors that target signaling transduction or resistance pathways. Mol Cancer Ther; 17(7); 1441–53. ©2018 AACR.