In response to injury, airway epithelia utilize an epidermal growth factor (EGF) receptor (EGFR) signaling program to institute repair and restitution. Protein tyrosine phosphatases (PTPs) counterregulate EGFR autophosphorylation and downstream signaling. PTPμ is highly expressed in lung epithelia and can be localized to intercellular junctions where its ectodomain homophilically interacts with PTPμ ectodomain expressed on neighboring cells. We asked whether PTPμ expression might be altered in response to epithelial injury and whether altered PTPμ expression might influence EGFR signaling. In A549 cells, diverse injurious stimuli dramatically reduced PTPμ protein expression. Under basal conditions, small interfering RNA (siRNA)-induced silencing of PTPμ increased EGFR Y992 and Y1068 phosphorylation. In the presence of EGF, PTPμ knockdown increased EGFR Y845, Y992, Y1045, Y1068, Y1086, and Y1173 but not Y1148 phosphorylation. Reduced PTPμ expression increased EGF-stimulated phosphorylation of Y992, a docking site for phospholipase C (PLC)γ(1), activation of PLCγ(1) itself, and increased cell migration in both wounding and chemotaxis assays. In contrast, overexpression of PTPμ decreased EGF-stimulated EGFR Y992 and Y1068 phosphorylation. Therefore, airway epithelial injury profoundly reduces PTPμ expression, and PTPμ depletion selectively increases phosphorylation of specific EGFR tyrosine residues, PLCγ(1) activation, and cell migration, providing a novel mechanism through which epithelial integrity may be restored.