Contractile forces mediated by RhoA and Rho kinase (ROCK) are required for a variety of cellular processes, including cell adhesion. In this study, we show that RhoA-dependent ROCKII activation is negatively regulated by phosphorylation at a conserved tyrosine residue (Y722) in the coiled-coil domain of ROCKII. Tyrosine phosphorylation of ROCKII is increased with cell adhesion, and loss of Y722 phosphorylation delays adhesion and spreading on fibronectin, suggesting that this modification is critical for restricting ROCKII-mediated contractility during these processes. Further, we provide evidence that Shp2 mediates dephosphorylation of ROCKII and, therefore, regulates RhoA-induced cell rounding, indicating that Shp2 couples with RhoA signaling to control ROCKII activation during deadhesion. Thus, reversible tyrosine phosphorylation confers an additional layer of control to fine-tune RhoA-dependent activation of ROCKII.