Protein tyrosine phosphatase 1B (PTP1B) has been implicated as a negative regulator of multiple signaling pathways downstream of receptor tyrosine kinases. Gene-targeting studies in mice have established PTP1B as a major target in diabetes and obesity. Initially, inhibition of this enzyme was thought to potentially lead to increased oncogenic signaling, but mice lacking PTP1B do not develop tumors. Our recent results show that loss of PTP1B can lead to decreased Ras signaling, despite enhanced signaling of other pathways. Here, we discuss how these findings implicate PTP1B as a positive and negative regulator of oncogenesis.