The pulmonary vascular endothelial paracellular pathway and zonula adherens (ZA) integrity are regulated, in part, through protein tyrosine phosphorylation. ZA-associated protein tyrosine phosphatase (PTP)s are thought to counterregulate tyrosine phosphorylation events within the ZA multiprotein complex. One such receptor PTP, PTPmu, is highly expressed in lung tissue and is almost exclusively restricted to the endothelium. We therefore studied whether PTPmu, in pulmonary vascular endothelia, associates with and/or regulates both the tyrosine phosphorylation state of vascular endothelial (VE)-cadherin and the paracellular pathway. PTPmu was expressed in postconfluent human pulmonary artery and lung microvascular endothelial cells (ECs) where it was almost exclusively restricted to EC-EC boundaries. In human lung microvascular ECs, knockdown of PTPmu through RNA interference dramatically impaired barrier function. In immortalized human microvascular ECs, overexpression of wild-type PTPmu enhanced barrier function. PTPmu-VE-cadherin interactions were demonstrated through reciprocal co-immunoprecipitation assays and co-localization with double-label fluorescence microscopy. When glutathione S-transferase-PTPmu was incubated with purified recombinant VE-cadherin, and when glutathione S-transferase-VE-cadherin was incubated with purified recombinant PTPmu, PTPmu directly bound to VE-cadherin. Overexpression of wild-type PTPmu decreased tyrosine phosphorylation of VE-cadherin. Therefore, PTPmu is expressed in human pulmonary vascular endothelia where it directly binds to VE-cadherin and regulates both the tyrosine phosphorylation state of VE-cadherin and barrier integrity.