Protein tyrosine phosphorylation has been implicated in the growth and functional responses of hematopoietic cells. Recently, approaches have been developed to characterize the protein tyrosine phosphatases that may contribute to regulation of protein tyrosine phosphorylation. One novel protein tyrosine phosphatase was expressed predominantly in hematopoietic cells. Hematopoietic cell phosphatase encodes a 68-kDa protein that contains a single phosphatase conserved domain. Unlike other known protein tyrosine phosphatases, hematopoietic cell phosphatase contains two src homology 2 domains. We also cloned the human homolog, which has 95% amino acid sequence identity. Both the murine and human gene products have tyrosine-specific phosphatase activity, and both are expressed predominantly in hematopoietic cells. Importantly, the human gene maps to chromosome 12 region p12-p13. This region is associated with rearrangements in approximately 10% of cases of acute lymphocytic leukemia in children.