Vascular endothelial growth factor (VEGF) receptor-2 (KDR/flk-1) has a tyrosine kinase domain, and once activated, induces the autophosphorylation of the tyrosine residues, which is essential for angiogenesis. SHP-1, a cytoplasmic protein tyrosine phosphatase, plays a negative regulatory role in signal transduction pathways by dephosphorylation of the receptors to which it binds. Thus, therapeutic angiogenesis designed to inhibit expression of SHP-1 would be beneficial in hindlimb ischemia. In in vitro, the inhibition of SHP-1 by SHP-1 siRNA impaired the ability of TNF to block the tyrosine phosphorylation of KDR/flk-1 induced by VEGF and showed an increase in endothelial cell growth. In in vivo, SHP-1 mRNA, SHP-1 protein levels and VEGF were increased in a rat model of hindlimb ischemia. Upon injection to the ischemic adductor muscle, vector-based siRNA reduced SHP-1, increased phosphorylation of KDR/flk-1, and markedly increased capillary density. Our data demonstrated in vivo the potential use of siRNA targeting SHP-1 as therapy for peripheral ischemic diseases.