During embryonic development, the growth of blood vessels requires the coordinated activation of endothelial receptor tyrosine kinases (RTKs) such as vascular endothelial growth factor receptor-2 (VEGFR-2) and Tie-2. Similarly, in adulthood, activation of endothelial RTKs has been shown to enhance development of the collateral circulation and improve blood flow to ischemic tissues. Recent evidence suggests that RTK activation is negatively regulated by protein tyrosine phosphatases (PTPs). In this study, we used the nonselective PTP inhibitor bis(maltolato)oxovanadium IV (BMOV) to test the potential efficacy of PTP inhibition as a means to enhance endothelial RTK activation and improve collateral blood flow. In cultured endothelial cells, pretreatment with BMOV augmented VEGFR-2 and Tie-2 tyrosine phosphorylation and enhanced VEGF- and angiopoietin-1-mediated cell survival. In rat aortic ring explants, BMOV enhanced vessel sprouting, a process that can be influenced by both VEGFR-2 and Tie-2 activation. Moreover, 2 wk of BMOV treatment in a rat model of peripheral vascular disease enhanced collateral blood flow similarly to VEGF, and after 4 wk, BMOV was superior to VEGF. Taken together, these studies provide evidence that PTPs are important regulators of endothelial RTK activation and for the first time demonstrate the potential utility of phosphatase inhibition as a means to promote collateral development and enhance collateral blood flow to ischemic tissue.