The Tec family member Bruton's tyrosine kinase (Btk) is a cytoplasmic protein tyrosine kinase that transduces signals from the pre-B and B cell receptor (BCR). Btk is involved in pre-B cell maturation by regulating IL-7 responsiveness, cell surface phenotype changes, and the activation of lambda L chain gene rearrangements. In mature B cells, Btk is essential for BCR-mediated proliferation and survival. Upon BCR stimulation, Btk is transphosphorylated at position Y551, which promotes its catalytic activity and subsequently results in autophosphorylation at position Y223 in the Src homology 3 domain. To address the significance of Y223 autophosphorylation and the requirement of enzymatic activity for Btk function in vivo, we generated transgenic mice that express the autophosphorylation site mutant Y223F and the kinase-inactive mutant K430R, respectively. We found that Y223 autophosphorylation was not required for the regulation of IL-7 responsiveness and cell surface phenotype changes in differentiating pre-B cells, or for peripheral B cell differentiation. However, expression of the Y223F-Btk transgene could not fully rescue the reduction of lambda L chain usage in Btk-deficient mice. In contrast, transgenic expression of kinase-inactive K430R-Btk completely reconstituted lambda usage in Btk-deficient mice, but the defective modulation of pre-B cell surface markers, peripheral B cell survival, and BCR-mediated NF-kappaB induction were partially corrected. From these findings, we conclude that: 1) autophosphorylation at position Y223 is not essential for Btk function in vivo, except for regulation of lambda L chain usage, and 2) during B cell development, Btk partially acts as an adapter molecule, independent of its catalytic activity.