The receptor-type form of protein tyrosine phosphatase epsilon (RPTP) is among the few tyrosine phosphatases that can support the transformed phenotype of tumor cells. Accordingly, cells from mammary epithelial tumors induced by activated Neu in mice genetically lacking RPTP appear morphologically less transformed and exhibit reduced proliferation. The effect of RPTP in these cells is mediated at least in part by its ability to activate Src, the prototypic member of a family of related kinases. We show here that RPTP is a physiological activator of two additional Src family kinases, Yes and Fyn. Activities of both kinases are inhibited in mammary tumor cells lacking RPTP, and phosphorylation at their C-terminal inhibitory tyrosines is increased. In agreement, opposite effects on activities and phosphorylation of Yes and Fyn are observed following increased expression of PTP. RPTP also forms stable complexes with either kinase, providing physical opportunity for their activation by RPTP. Surprisingly, expression of Yes or of Fyn does not rescue the morphological phenotype of RPTP-deficient tumor cells in contrast with the strong ability of Src to do so. We conclude that RPTP activates Src, Yes, and Fyn, but that these related kinases play distinct roles in Neu-induced mammary tumor cells.