Class IA phosphotidylinositol-3-kinases (PI3Ks) are a family of p85/p110 heterodimeric lipid kinases that are important in regulating signaling events in B and T cells. However, their role in natural killer (NK) cells is not understood. Here, using mice that lack the regulatory p85alpha subunit and its alternatively spliced variants p55alpha/p50alpha (collectively termed as p85alpha(-/-)), we defined the role of PI3K in NK cell development and function. p85alpha(-/-) mice had impaired lineage commitment leading to reduced NK cellularity in the bone marrow and liver. p85alpha(-/-) NK cells showed a defective Ly49 subset specification and a decreased expression of CD43. Lack of p85alpha severely reduced the NK-mediated cytotoxicity against tumor cells representing 'induced-self' and 'missing-self'. More importantly, NKG2D and NK1.1 receptor-mediated cytokine and chemokine generation was significantly compromised in p85alpha(-/-) NK cells. These results reveal a previously unrecognized role of p85alpha in the development, terminal maturation, cytokine/chemokine generation and tumor clearance of NK cells.