An Epstein-Barr virus-encoded protein, LMP2, blocks the effects of surface immunoglobulin (slg) cross-linking on calcium mobilization and on lytic reactivation of EBV in latently infected and growth-transformed primary human B lymphocytes. In wild-type EBV-transformed cells, LMP2 is constitutively tyrosine phosphorylated and is associated with Lyn and Syk protein-tyrosine kinases (PTKs). Baseline Lyn PTK activity is substantially reduced, and slg cross-linking fails to activate Lyn, Syk, Pl3-K, PLC gamma 2, Vav, Shc, and MAPK. Syk, Pl3-K, PLC gamma 2, and Vav are constitutively tyrosine phosphorylated, and their tyrosine phosphorylation does not change following slg cross-linking. In contrast, cross-linking slg on cells transformed by LMP2 null mutant EBV recombinants triggers the same protein tyrosine kinase cascade as in noninfected B lymphocytes. These data are consistent with a model in which LMP2 is a constitutive dominant negative modulator of slg receptor signaling through its effects on Lyn, Syk, or regulators of these kinases.