The adaptor protein, downstream of tyrosine kinases-1 (Dok-1), and the phosphatase SHIP are both tyrosine phosphorylated in response to T cell stimulation. However, a function for these molecules in T cell development has not been defined. To clarify the role of Dok-1 and SHIP in T cell development in vivo, we compared the T cell phenotype of wild-type, Dok-1 knockout (KO), SHIP KO, and Dok-1/SHIP double-knockout (DKO) mice. Dok-1/SHIP DKO mice were runted and had a shorter life span compared with either Dok-1 KO or SHIP KO mice. Thymocyte numbers from Dok-1/SHIP DKO mice were reduced by 90%. Surface expression of both CD25 and CD69 was elevated on freshly isolated splenic CD4(+) T cells from SHIP KO and Dok-1/SHIP DKO, suggesting these cells were constitutively activated. However, these T cells did not proliferate or produce IL-2 after stimulation. Interestingly, the CD4(+) T cells from SHIP KO and Dok-1/SHIP DKO mice produced higher levels of TGF-beta, expressed Foxp3, and inhibited IL-2 production by CD3-stimulated CD4(+)CD25(-) T cells in vitro. These findings suggest Dok-1 and SHIP function in pathways that influence regulatory T cell development.