The incidence of amplification of neu oncogene-encoded protein tyrosine kinase in human breast cancer strongly supports the concept that protein tyrosine phosphorylation and dephosphorylation are key regulatory mechanisms in the proliferation, differentiation, and neoplastic transformation of breast epithelial cells. We examined the potential regulatory role of protein tyrosine phosphatases (PTPases) in the maintenance of cellular tyrosine phosphorylation by the introduction of leukocyte common-antigen-related PTPase (LAR-PTPase) cDNA into a tumorigenic human breast carcinoma cell line that overexpressed p185neu protein tyrosine kinase. The transfected human breast carcinoma cells expressed elevated levels of LAR-PTPase as assessed by reverse transcription-polymerase chain reaction and by analysis of LAR-PTPase protein. The LAR-PTPase-transfected human breast carcinoma cells had a significantly (P < 0.01) slower proliferation rate in vitro than control-transfected cells. When LAR-PTPase-transfected cells were inoculated into athymic nude mice, a consistent and significant (P < 0.05) suppression of tumor growth was observed. These results provide evidence that a specific PTPase, LAR-PTPase, can play a suppressive regulatory role in the tumor growth of human breast carcinoma cells that overexpress p185neu protein tyrosine kinase.