The cytoplasmic phosphatase PTPN22 (protein tyrosine phosphatase nonreceptor type 22) plays a key role in regulating lymphocyte homeostasis, which ensures that the total number of lymphocytes in the periphery remains relatively constant. Mutations in PTPN22 confer an increased risk of developing autoimmune diseases; however, the precise function of PTPN22 and how mutations contribute to autoimmunity remain controversial. Loss-of-function mutations in PTPN22 are associated with increased numbers of effector T cells and autoreactive B cells in humans and mice; however, the complete absence of PTPN22 in mice does not result in spontaneous autoimmunity. We found that PTPN22 was a key regulator of regulatory T cell (T_reg) function that fine-tuned the signaling of the T cell receptor and integrins. PTPN22^−/− T_regs were more effective at immunosuppression than were wild-type T_regs, and they suppressed the activity of PTPN22^−/− effector T cells, preventing autoimmunity. Compared to wild-type T_regs, PTPN22^−/− T_regs produced increased amounts of the immunosuppressive cytokine interleukin-10 and had enhanced adhesive properties mediated by the integrin lymphocyte function–associated antigen-1, processes that are critical for T_reg function. This previously undiscovered role of PTPN22 in regulating integrin signaling and T_reg function suggests that PTPN22 may be a useful therapeutic target for manipulating T_reg function in human disease.