The proinflammatory cytokine tumor necrosis factor (TNF) modulates cellular responses through the mitogen-activated protein kinase (MAPK) and nuclear factor-κB (NF-κB) signaling pathways, but the molecular mechanisms underlying MAPK activation are unknown. T cell protein tyrosine phosphatase (TCPTP) is essential for hematopoietic development and negatively regulates inflammatory responses. Using TCPTP-deficient fibroblasts, we show here that TCPTP regulates TNF-induced MAPK but not NF-κB signaling. TCPTP interacted with the adaptor protein TRAF2, and dephosphorylated and inactivated Src tyrosine kinases to suppress downstream signaling through extracellular signal–regulated kinases and production of interleukin 6. These results link TCPTP and Src tyrosine kinases to the selective regulation of TNF-induced MAPK signaling and identify a previously unknown mechanism for modulating inflammatory responses mediated by TNF.