Incremental interference cancelation (IC) capability management and signaling is disclosed. A mobile device selects certain groups of its individual IC capabilities to deactivate in response to various operating conditions it is experiencing. The mobile device reports its currently active IC capability to a serving base station, which uses information to determine whether to modify any existing communication conditions with respect to the reporting mobile device. The base station detects and analyzes the current communication conditions with respect to the reporting mobile device in light of the mobile device's currently active IC capabilities. The base station may modify such conditions through actions such as signaling the mobile device to activate or deactivate certain other groups of IC capabilities. The base station can make other modifications such as changing the communication schedule for the mobile device, modifying the control loop for channel quality indicator (CQI) reporting, and the like.