Grb2-associated binder-1 (Gab1) is a multisite docking protein containing a pleckstrin homology (PH) domain, multiple potential tyrosine phosphorylation sites, and several proline-rich sequences. Gab1 becomes tyrosine-phosphorylated in cells stimulated with growth factors, cytokines, and ligands for G protein-coupled receptors. A major Gab1-binding protein detected in cells treated with extracellular stimuli is the tyrosine phosphatase, SHP2. Although the role of SHP2-Gab1 interaction in cell signaling has not yet been characterized, SHP2 is known to mediate mitogen-activated protein (MAP) kinase activation induced by the epidermal growth factor (EGF). However, the mechanism by which the SHP2 phosphatase exerts a positive signaling role remains obscure. In this study, we prepared Gab1 mutants lacking the SHP2 binding site (Gab1Y627F), the phosphatidylinositol 3-kinase (PI3K) binding sites (Gab1DeltaPI3K), and the PH domain (Gab1DeltaPH). Expression of Gab1Y627F blocked the extracellular signal-regulated kinase-2 (ERK2) activation by lysophosphatidic acid (LPA) and EGF. Conversely, expression of the wild-type Gab1 in HEK293 cells augmented the LPA receptor Edg2-mediated ERK2 activation. Whereas the PH domain was required for Gab1 mediation of ERK2 activation by LPA, it was not essential for EGF-induced ERK2 activation. Expression of Gab1DeltaPI3K had no apparent effect on ERK2 activation by LPA and EGF in the cells that we have examined. These results establish a role for Gab1 in the LPA-induced MAP kinase pathway and clearly demonstrate that Gab1-SHP2 interaction is essential for ERK2 activation by LPA and EGF. These findings also suggest that the positive role of SHP2 in the MAP kinase pathway depends on its interaction with Gab1.