Adult T-cell leukemia (ATL) is an aggressive malignancy that is associated with human T-cell lymphotropic virus I (HTLV-I) infection. HTLV-I transformed T-cell lines and fresh ATL cells are characterized by constitutive activation of the interleukin-2 receptor (IL-2R) signaling pathway however, the mechanism(s) responsible for constitutive IL-2R activation are unknown. To further examine the cause of this signaling pathway deregulation, we measured mRNA and protein expression levels by real-time PCR and Western blots, respectively, of four negative regulators of the IL-2R signaling pathway including src homology 2 (SH2)-containing phosphatase (SHP1), cytokine-inducible (CIS) SH2-containing protein, suppressor of cytokine signaling-1 (SOCS1) and protein inhibitor of activated signal transducer and activator of transcription 3 (STAT3) (PIAS3) in six HTLV-1 negative and seven HTLV-1 positive T-cell leukemia lines. The activation status of the JAK/STAT pathway was also examined. SHP1 mRNA and protein expression levels were selectively down regulated in all HTLV-1-infected transformed cell lines, while CIS, SOCS1, and PIAS3 protein expression were markedly but variably upregulated and the cells showed evidence of constitutive STAT3 activation. In acutely HTLV-1 infected primary CD4+ T-cells there was a gradual loss of SHP1 expression over 10 weeks in culture which correlated with progression from immortalization to transformation and loss of IL-2 dependence for growth. Two transformed cell lines that were established following HTLV-1 infection showed loss of SHP1 expression and overexpression of CIS, SOCS1, PIAS3. However, this overexpression was not adequate to block constitutive activation of the JAK/STAT pathway. Thus, multiple levels of IL-2 receptor signal deregulation are found in HTLV-1 transformed cells, which may be a result of early loss of SHP1 expression.