Phosphatidylinositol 4,5-bisphosphate (PIP₂) reorganizes actin filaments by modulating the functions of a variety of actin-regulatory proteins. Until now, it was thought that bound PIP₂ is hydrolyzed only by tyrosine-phosphorylated phospholipase Cγ (PLCγ) after the activation of tyrosine kinases. Here, we show a new mechanism for the hydrolysis of bound PIP₂ and the regulation of actin filaments by PIP₂ phosphatase (synaptojanin). We isolated a 150-kDa protein (p150) from brains that binds the SH3 domains of Ash/Grb2. The sequence of this protein was found to be homologous to that of synaptojanin. The expression of p150 in COS 7 cells produces a decrease in the number of actin stress fibers in the center of the cells and causes the cells to become multinuclear. On the other hand, the expression of a PIP₂ phosphatase-negative mutant does not disrupt actin stress fibers or produce the multinuclear phenotype. We have also shown that p150 forms the complexes with Ash/Grb2 and epidermal growth factor (EGF) receptors only when the cells are treated with EGF and that it reorganizes actin filaments in an EGF-dependent manner. Moreover, the PIP₂ phosphatase activity of native p150 purified from bovine brains is not inhibited by profilin, cofilin, or α-actinin, although PLCδ1 activity is markedly inhibited by these proteins. Furthermore, p150 suppresses actin gelation, which is induced by smooth muscle α-actinin. All these data suggest that p150 (synaptojanin) hydrolyzes PIP₂ bound to actin regulatory proteins, resulting in the rearrangement of actin filaments downstream of tyrosine kinase and Ash/Grb2.