Our previous studies have shown that IWS1 (Interacts with Spt6) is a phosphorylation target of AKT and regulates the alternative RNA splicing of FGFR2, linking IWS1 with human Non-Small Cell Lung Cancer. To further address the role of IWS1 in alternative RNA splicing in lung cancer, we performed an RNA-seq study using lung adenocarcinoma cells in which IWS1 was knocked down or replaced by its phosphorylation site mutant. The results identified a novel, exon 2 deficient splice variant of the splicing factor U2 Associated-Factor 2 (U2AF2), whose abundance increases, upon the loss of phosphorylated IWS1. This exon encodes part of the U2AF65 Serine-Rich (SR) Domain, which is required for its binding with pre-mRNA Processing factor 19 (Prp19). Here, we show that U2AF2 exon 2 inclusion depends on phosphorylated IWS1, by promoting histone H3K36 trimethylation and the assembly of LEDGF/SRSF1 splicing complexes, in a cell-cycle specific manner. Inhibition of the pathway results in the downregulation of cell cycle division associated 5 (CDCA5), a phosphorylation target and regulator of ERK, leading to G2/M phase arrest, impaired cell proliferation and tumor growth in mouse xenografts models, an effect more pronounced in EGFR mutant cells. Analysis of lung adenocarcinoma samples revealed strong correlations between IWS1 phosphorylation, U2AF2 RNA splicing, and Sororin/p-ERK levels, especially in EGFR, as opposed to K-RAS mutant patients. More importantly, IWS1 phosphorylation and U2AF2 RNA splicing pattern are positively correlated with tumor stage, grade and metastasis, and associated with poor survival in the same patients. This work highlights the instrumental role of the AKT/p-IWS1 axis to alternative RNA splicing in governing cell cycle progression and tumorigenesis and proposes this axis as a novel drug target in EGFR mutant lung adenocarcinoma, by concomitantly affecting the epigenetic regulation of RNA processing and oncogenic signals.