Shp-2, a widely expressed cytoplasmic tyrosine phosphatase with two src-homology 2 (SH2) domains, has received much attention in the signal transduction field recently. Significant progress has been made in understanding the structure and function of this phosphatase, together with its Drosophila homologue, Corkscrew, as well as the close relative Shp-1 tyrosine phosphatase. The crystal structure of Shp-2 revealed an autoinhibitory mechanism of the catalytic activity by the N-terminal SH2 domain. Shp-2 apparently participates in signaling events downstream of receptors for growth factors, cytokines, hormones, antigens, and extracellular matrixes in the control of cell growth, differentiation, migration, and death. Shp-2 is an important molecule that integrates signals among various cytoplasmic pathways and may also couple intracellular and intercellular information flow.