Catalytically activating mutations in Ptpn11, which encodes the protein tyrosine phosphatase SHP2, cause 50% of Noonan Syndrome (NS) cases, whereas inactivating mutations in Ptpn11 are responsible for nearly all cases of the similar, but distinct, developmental disorder Noonan Syndrome with Multiple Lentigines (NSML, formerly called LEOPARD Syndrome). Both types of disease mutations are gain-of-function mutations because they induce SHP2 to constitutively adopt an open conformation, yet they have opposing effects on SHP2 catalytic activity. Here, we report that the catalytic activity of SHP2 is required for the pathogenic effects of Ptpn11 gain-of-function disease-associated mutations on the development of hydrocephalus in the mouse. Targeted pan-neuronal knock-in of the Ptpn11 activating mutation E76K resulted in hydrocephalus due to aberrant development of ependymal cells and their cilia. These pathogenic effects of the E76K mutation were completely suppressed by the additional mutation C459S, which abolishes catalytic activity of SHP2. Moreover, ependymal cells in NSML mice bearing the Ptpn11 inactivating mutation Y279C were also unaffected. Mechanistically, the Ptpn11E76K mutation induced developmental defects in ependymal cells by enhancing dephosphorylation and inhibition of the transcriptional activator STAT3. Whereas STAT3 activity was reduced in Ptpn11E76K/+ cells, the activities of the kinases ERK and AKT were enhanced, and neural cellâspecific Stat3 knockout mice also manifested developmental defects in ependymal cells and cilia. These genetic and biochemical data demonstrate a catalyticâdependent role of Ptpn11 gain-of-function disease mutations in the pathogenesis of hydrocephalus.