Protein tyrosine phosphatase alpha (PTPα/PTPRA) was shown previously to be overexpressed in human primary breast cancers, and to suppress apoptosis in estrogen receptor-negative breast cancer cells in vitro. However, it is not known whether PTPα is important for mammary tumor initiation, maintenance and/or progression. We have used a combination of three-dimensional cultures, a transgenic mouse model of breast cancer lacking PTPα as well as xenografts of human breast cancer cell lines to address these questions. We found that PTPα knockdown after overt tumor development reduced the growth of HER2-positive human breast cancer cell lines, and that this effect was accompanied by a reduction in AKT phosphorylation. However, PTPα knockdown did not affect invasiveness of HER2-positive human breast cancer cells grown in three-dimensional cultures. Moreover, in MMTV-NeuNT/PTPα(-/-) mice, PTPα ablation did not affect NeuNT-evoked tumor onset or metastasis but decreased the number of tumors per mouse. Thus, we demonstrate that PTPα contributes to both HER2/Neu-mediated mammary tumor initiation and maintenance. Our results suggest that inhibition of PTPα can have a beneficial effect on HER2-positive breast cancers, but that inhibition of additional targets is needed to block breast tumorigenesis.