Genetic alterations in receptor tyrosine kinase (RTK) genes can generate potent oncogenic drivers. Truncation of the fibroblast growth factor receptor 2 (FGFR2) gene by its last exon 18 (E18) is caused by structural alterations, such as focal amplifications and gene fusions/rearrangements, as well as by mutations. All the E18-truncating FGFR2 variants (FGFR2ΔE18) act as strong driver alterations in cancer, and they commonly encode a receptor lacking the carboxy (C)-terminal tail. Here, we analyzed a compendium of Fgfr2-E18 variants to uncover the mechanism by which loss of the C-tail renders FGFR2 oncogenic. While permutation of previously annotated C-terminal FGFR motifs did not recapitulate the tumorigenicity of FGFR2ΔE18, the functional annotation efforts led to the discovery of a C-terminal phenylalanine-serine motif that mediates binding of the C-tail to the kinase domain and thereby suppresses FGFR2 kinase activity. Permutation of this kinase domain-binding and suppression (KDBS) motif in conjunction with other FGFR2-regulatory C-terminal sites fully phenocopied the oncogenic competence of FGFR2ΔE18. Together, these findings delineate how the C-terminal tail prevents FGFR2 from aberrant oncogenic activation.