The protein tyrosine phosphatase (PTP) PTPL1/PTPN13 is a candidate tumor suppressor gene. Indeed, PTPL1 activity has been reported recently to be decreased through somatic mutations, allelic loss, or promoter methylation in some tumors. We showed previously that its expression was necessary for inhibition of Akt activation and induction of apoptosis by antiestrogens in breast cancer cells. Implications of the phosphatidylinositol 3-kinase (PI3K)/Akt signaling pathway in cancer progression are now well established, and our study was therefore designed to define whether PTPL1 is sufficient to inhibit this pathway and, if so, to identify a direct substrate of this PTP, which may trigger a proapoptotic effect. We first show by complementary approaches that PTPL1 specifically dephosphorylates insulin receptor substrate-1 (IRS-1) in vitro and in cellulo. Next, our experiments using a dominant-negative mutant and RNA interference confirm the crucial role of PTPL1 in IRS-1 dephosphorylation. Finally, we report that PTPL1 expression is sufficient to block the IRS-1/PI3K/Akt signaling pathway, to inhibit the insulin-like growth factor-I effect on cell survival, and to induce apoptosis. Altogether, these data provide the first evidence for a direct positive role of the putative tumor suppressor gene PTPL1/PTPN13 on apoptosis and identify its target in the IRS-1/PI3K/Akt signaling pathway.