Activating and inhibitory receptors control natural killer (NK) cell activity. T-cell immunoglobulin and ITIM (immunoreceptor tyrosine-based inhibition motif) domain (TIGIT) was recently identified as a new inhibitory receptor on T and NK cells that suppressed their effector functions. TIGIT harbors the immunoreceptor tail tyrosine (ITT)-like and ITIM motifs in its cytoplasmic tail. However, how its ITT-like motif functions in TIGIT-mediated negative signaling is still unclear. Here, we show that TIGIT/PVR (poliovirus receptor) engagement disrupts granule polarization leading to loss of killing activity of NK cells. The ITT-like motif of TIGIT has a major role in its negative signaling. After TIGIT/PVR ligation, the ITT-like motif is phosphorylated at Tyr225 and binds to cytosolic adapter Grb2, which can recruit SHIP1 to prematurely terminate phosphatidylinositol 3-kinase (PI3K) and MAPK signaling, leading to downregulation of NK cell function. In support of this, Tyr225 or Asn227 mutation leads to restoration of TIGIT/PVR-mediated cytotoxicity, and SHIP1 silencing can dramatically abolish TIGIT/PVR-mediated killing inhibition.