Extracellular stimulation of the B cell receptor or mast cell FcεRI receptor activates a cascade of protein kinases, ultimately leading to antigenic or inflammation immune responses, respectively. Syk is a soluble kinase responsible for transmission of the receptor activation signal from the membrane to cytosolic targets. Control of Syk function is, therefore, critical to the human antigenic and inflammation immune response, and an inhibitor of Syk could provide therapy for autoimmune or inflammation diseases. We report here a novel allosteric Syk inhibitor, X1, that is noncompetitive against ATP (K(i) 4 ± 1 μM) and substrate peptide (K(i) 5 ± 1 μM), and competitive against activation of Syk by its upstream regulatory kinase LynB (K(i) 4 ± 1 μM). The inhibition mechanism was interrogated using a combination of structural, biophysical, and kinetic methods, which suggest the compound inhibits Syk by reinforcing the natural regulatory interactions between the SH2 and kinase domains. This novel mode of inhibition provides a new opportunity to improve the selectivity profile of Syk inhibitors for the development of safer drug candidates.