Cbl proteins downregulate metazoan signalling pathways by ubiquitylating receptor tyrosine kinases, thereby targeting them for degradation. They contain a phosphotyrosine-binding region, comprising an EF-hand and an SH2 domain, linked to an E3 ubiquitin-ligase domain. CblA, a Dictyostelium homologue of the Cbl proteins, contains all three conserved domains. In a cblA(-) strain early development occurs normally but migrating cblA(-) slugs frequently fragment and the basal disc of the culminants that are formed are absent or much reduced. These are characteristic features of mutants in signalling by DIF-1, the low-molecular-mass prestalk and stalk cell inducer. Tyrosine phosphorylation of STATc is induced by DIF-1 but in the cblA(-) strain this response is attenuated relative to parental cells. We present evidence that CblA fulfils this function, as a positive regulator of STATc tyrosine phosphorylation, by downregulating PTP3, the protein tyrosine phosphatase responsible for dephosphorylating STATc. Thus Cbl proteins have an ancient origin but, whereas metazoan Cbl proteins regulate tyrosine kinases, the Dictyostelium Cbl regulates via a tyrosine phosphatase.