Cancers arising from the bladder urothelium often exhibit lineage plasticity with regions of urothelial carcinoma adjacent to or admixed with regions of divergent histomorphology, most commonly squamous differentiation. To define the biologic basis for and clinical significance of this morphologic heterogeneity, here we perform integrated genomic analyses of mixed histology bladder cancers with separable regions of urothelial and squamous differentiation. We find that squamous differentiation is a marker of intratumoral genomic and immunologic heterogeneity in patients with bladder cancer and a biomarker of intrinsic immunotherapy resistance. Phylogenetic analysis confirms that in all cases the urothelial and squamous regions are derived from a common shared precursor. Despite the presence of marked genomic heterogeneity between co-existent urothelial and squamous differentiated regions, no recurrent genomic alteration exclusive to the urothelial or squamous morphologies is identified. Rather, lineage plasticity in bladder cancers with squamous differentiation is associated with loss of expression of FOXA1, GATA3, and PPARG, transcription factors critical for maintenance of urothelial cell identity. Of clinical significance, lineage plasticity and PD-L1 expression is coordinately dysregulated via FOXA1, with patients exhibiting morphologic heterogeneity pre-treatment significantly less likely to respond to immune checkpoint inhibitors.