Studies in Jurkat leukemia cells have suggested that protein-tyrosine phosphatase PTPL1/FAP-1 rescues Fas-induced cell death. However, we have previously shown that this enzyme triggers 4-hydroxytamoxifen-induced growth inhibition in human breast cancer cells. The present study addresses the role of PTPL1/FAP-1 in antiestrogen-regulated apoptotic effect and insulin-like growth factor-I survival action in MCF7 cells and further identifies the impacted signaling pathway. By terminal deoxynucleotidyltransferase-mediated dUTP-biotin nick end labeling and cytoplasmic nucleosome enzyme-linked immunosorbent assay, we demonstrated that 4-hydroxytamoxifen-induced apoptosis was totally lost in PTPL1/FAP-1 antisense transfectants in which enzyme expression was abrogated, revealing the crucial role of this phosphatase in the apoptotic process in human breast cancer cells. Time-dependent expression of PTPL1/FAP-1 in MCF7 cells completely abolished the survival action of insulin-like growth factor-I. This effect occurred through a highly significant reduction in phosphatidylinositol 3-kinase/Akt pathway activation (80% reduction in phosphatidylinositol 3-kinase activity, 55% inhibition of Akt activation) accompanied by a 65% decrease in insulin receptor substrate-1 growth factor-induced tyrosine phosphorylation. These results provide the first evidence that PTPL1/FAP-1 has a key role in the apoptotic process in human breast cancer cells independent of Fas but associated with an early inhibition of the insulin receptor substrate-1/phosphatidylinositol 3-kinase pathway. Our data therefore suggest new therapeutic routes and strengthen the importance of identifying endogenous regulators and substrates of this phosphatase in breast tumors.