Diacylglycerol kinases (DGKs) metabolize diacylglycerol to phosphatidic acid. In T lymphocytes, DGKα acts as a negative regulator of TCR signaling by decreasing diacylglycerol levels and inducing anergy. In this study, we show that upon costimulation of the TCR with CD28 or signaling lymphocyte activation molecule (SLAM), DGKα, but not DGKζ, exits from the nucleus and undergoes rapid negative regulation of its enzymatic activity. Inhibition of DGKα is dependent on the expression of SAP, an adaptor protein mutated in X-linked lymphoproliferative disease, which is essential for SLAM-mediated signaling and contributes to TCR/CD28-induced signaling and T cell activation. Accordingly, overexpression of SAP is sufficient to inhibit DGKα, whereas SAP mutants unable to bind either phospho-tyrosine residues or SH3 domain are ineffective. Moreover, phospholipase C activity and calcium, but not Src-family tyrosine kinases, are also required for negative regulation of DGKα. Finally, inhibition of DGKα in SAP-deficient cells partially rescues defective TCR/CD28 signaling, including Ras and ERK1/2 activation, protein kinase C membrane recruitment, induction of NF-AT transcriptional activity, and IL-2 production. Thus SAP-mediated inhibition of DGKα sustains diacylglycerol signaling, thereby regulating T cell activation, and it may represent a novel pharmacological strategy for X-linked lymphoproliferative disease treatment.