The association of the murine motheaten phenotype of severe hemopoietic dysregulation with loss of PTP1C tyrosine phosphatase activity indicates a critical role for this SH2 domain-containing phosphotyrosine phosphatase in the regulation of hemopoietic cell growth and differentiation. To explore the molecular basis for PTP1C effects on hematopoiesis, we have investigated the possibility that this enzyme interacts with the product of the Vav proto-oncogene, a putative guanine nucleotide exchange factor expressed exclusively in hemopoietic cells. Our data indicate that PTP1C physically associates with Vav in murine spleen cells and in EL4 T lymphoma and P815 mastocytoma cells, and that this interaction is increased following mitogenic stimulation and the induction of both PTP1C and Vav tyrosine phosphorylation. The results also reveal tyrosine phosphatase activity to be present in Vav immunoprecipitates from stimulated splenic and P815 cells and suggest that a major portion of total cellular PTP1C catalytic activity is associated with Vav. As Vav-associated tyrosine phosphatase activity was not detected in PTP1C-deficient motheaten splenic cells, it appears that PTP1C accounts for most, if not all, Vav-coprecipitable tyrosine phosphatase activity in normal cells. The data also demonstrate the capacity of the Vav SH2 domain alone to bind to PTP1C in activated P815 cells, but suggest a role for the two Vav SH3 domains in enhancing this interaction. In addition, the results reveal PTP1C association with two other molecules implicated in Ras activation, the Grb2 adaptor protein and mSos1, a GTP/GDP exchanger for Ras. PTP1C therefore has the capacity to bind and potentially modulate various signaling effectors involved in activation of Ras or Ras-related proteins, and, accordingly, regulation of Ras activation represents a possible mechanism whereby PTP1C influences hemopoietic cellular responses.Among the phosphotyrosine phosphatases (PTP) 1 identified to date, the cytosolic enzyme PTP1C is distinguished by its predominant expression in hemopoietic cells and the presence of two N-terminal located Src homology 2 (SH2) domains, a motif found in only two other PTPs, Syp (PTP1D/SHPTP2) and the Drosophila csw protein (1-6). These properties, together with the recent data linking PTP1C gene mutations to the profound hemopoietic dysregulation manifested by motheaten (me) and viable motheaten (me v ) mice (7-9), reveal a critical role for PTP1C in modulating hemopoietic cell differentiation and growth. As this PTP has been shown to associate with the activated c-kit, erythropoietin, and IL-3 receptors (10 -12) and, more recently, with the B cell antigen receptor complex and the CD22 and Fc␥RIIB1 receptors on lymphocytes (13-15), PTP1C appears to subserve its regulatory role, at least in part, by modulating the signaling capacities of membrane growth factor/antigen/cytokine receptors. As is consistent with the marked overexpansion of multiple hemopoietic cell types observed in PTP1C-deficient motheaten mice, the data concernin...