Oligodendrocyte progenitor cells first proliferate to generate sufficient cell numbers and then differentiate into myelin-producing oligodendrocytes. The signal transduction mediators that underlie these events, however, remain poorly understood. The tyrosine phosphatase Shp1 has been linked to oligodendrocyte differentiation as Shp1-deficient mice show hypomyelination. The Shp1 homolog, Shp2, has recently been shown to regulate astrogliogenesis, but its role in oligodendrocyte development remains unknown. Here, we report that Shp2 protein levels were developmentally regulated in oligodendrocytes, with Shp2 phosphorylation being promoted by oligodendroglial mitogens but suppressed by laminin, an extracellular matrix protein that promotes oligodendroglial differentiation. In contrast, oligodendrocyte progenitors were found to be unresponsive to mitogens following Shp2, but not Shp1, depletion. In agreement with previous studies, Shp1 depletion led to decreased levels of myelin basic protein in differentiating oligodendrocytes, as well as reduced outgrowth of myelin membrane sheets. Shp2 depletion in contrast did not prevent oligodendrocyte differentiation but promoted expanded myelin membrane outgrowth. Taken together these data suggest that Shp1 and Shp2 have distinct functions in oligodendrocyte development: Shp2 regulates oligodendrocyte progenitor proliferation and Shp1 regulates oligodendrocyte differentiation. Adhesion to laminin may additionally provide extrinsic regulation of Shp2 activity and thus promote the transition from progenitor to differentiating oligodendrocyte.