Shp-2 has a positive regulatory role in ES cell differentiation and proliferation.

Shp-2 is a ubiquitously expressed tyrosine phosphatase with two SH2 domains. Homozygous mutant mice with a targeted deletion of 65 amino acid residues in the N-terminal SH2 domain of Shp-2 die in utero at mid-gestation, with multiple defects in mesodermal patterning. To surpass the embryonic lethality in dissecting the Shp-2 function in cell growth and differentiation, we established homozygous Shp-2 mutant embryonic stem (ES) cell lines. Our previous data showed a severe suppression of hematopoietic cell differentiation from Shp-2 mutant ES cells. Here we demonstrate that development of cardiac muscle cells was dramatically delayed and impaired in embryoid bodies (EBs) of Shp-2 mutant origin. Shp-2 mutant ES cells failed to differentiate into epithelial and fibroblast cells in vitro. However, higher efficiency of secondary EB formation was observed from the mutant than the wild-type ES cells. Further, mutant ES cells were more sensitive than wild-type cells to the differentiation suppressing effect of leukemia inhibitory factor (LIF). In addition, mutant ES cells showed a reduced growth rate compared to wild-type cells. These results suggest that the Shp-2 tyrosine phosphatase is a positive regulator for both cell differentiation and proliferation, in contrast to the Src-family kinases which promote cell growth but block differentiation.