Abstract Immunoreceptor tyrosine-based inhibitory motifs (ITIM) have been implicated in the negative modulation of immunoreceptor signaling pathways. The IL-4R α-chain (IL-4Rα) contains a putative ITIM in the carboxyl terminal. To determine the role of ITIM in the IL-4 signaling pathway, we ablated the ITIM of IL-4Rα by deletion and site-directed mutagenesis and stably expressed the wild-type (WT) and mutant hIL-4Rα in 32D/insulin receptor substrate-2 (IRS-2) cells. Strikingly, 32D/IRS-2 cells expressing mutant human (h)IL-4Rα were hyperproliferative in response to IL-4 compared with cells expressing WT hIL-4Rα. Enhanced tyrosine phosphorylation of Stat6, but not IRS-2, induced by hIL-4 was observed in cells expressing mutant Y713F. Using peptides corresponding to the ITIM of hIL-4Rα, we demonstrate that tyrosine-phosphorylated peptides, but not their nonphosphorylated counterparts, coprecipitate SH2-containing tyrosine phosphatase-1, SH2-containing tyrosine phosphatase-2, and SH2-containing inositol 5′-phosphatase. The in vivo association of SH2-containing inositol 5′-phosphatase with IL-4Rα was verified by coimmunoprecipitation with anti-IL-4Rα Abs. These results demonstrate a functional role for ITIM in the regulation of IL-4-induced proliferation.