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KIR-based inhibitory CARs overcome CAR-NK cell trogocytosis-mediated fratricide and tumor escape. Trogocytosis is an active process that transfers surface material from targeted to effector cells. Using multiple in vivo tumor models and clinical data, we report that chimeric antigen receptor (CAR) activation in natural killer (NK) cells promoted transfer of the CAR cognate antigen from tumor to NK cells, resulting in (1) lower tumor antigen density, thus impairing the ability of CAR-NK cells to engage with their target, and (2) induced self-recognition and continuous CAR-mediated engagement, resulting in fratricide of trogocytic antigen-expressing NK cells (NKTROG+) and NK cell hyporesponsiveness. This phenomenon could be offset by a dual-CAR system incorporating both an activating CAR against the cognate tumor antigen and an NK self-recognizing inhibitory CAR that transferred a 'don't kill me' signal to NK cells upon engagement with their TROG+ siblings. This system prevented trogocytic antigen-mediated fratricide, while sparing activating CAR signaling against the tumor antigen, and resulted in enhanced CAR-NK cell activity.