Interleukin-22 (IL-22) is a member of the IL-10 family of cytokines produced by activated T cells and is involved in several tissue responses. IL-22 signals through a heterodimeric receptor composed of IL-22 receptor 1 (IL-22R1) and IL-10R2, and the intracellular signaling pathways mediated by IL-22 receptor are not completely known. Here we investigate the effect of Src homology-2 containing protein-tyrosine phosphatase (Shp2) on IL-22 signaling pathway using SW480 colon cancer cells as a model. The results show that IL-22 induces IL-22R1 phosphorylation, and Shp2 is recruited to the tyrosine phosphorylated IL-22R1 upon IL-22 stimulation. Furthermore, Tyr251 and Tyr301 of IL-22R1 are required for Shp2 binding to the IL-22R1. Shp2 binding to IL-22R1 and Shp2 protein tyrosine phosphatase activity are required for activation of MAP kinases and signal transducer and activator of transcription (STAT3) phosphorylation by IL-22. These results reveal a critical role of Shp2 in IL-22 mediated signal transduction pathways.