Helicobacter pylori produces a vacuolating cytotoxin, VacA, and most virulent H. pylori strains secrete VacA. VacA binds to two types of receptor-like protein tyrosine phosphatase (RPTP), RPTPalpha and RPTPbeta, on the surface of host cells. VacA bound to RPTPbeta, relocates and concentrates in lipid rafts in the plasma membrane. VacA causes vacuolization, membrane anion-selective channel and pore formation, and disruption of endosomal and lysosomal activity in host cells. Secreted VacA is processed into p33 and p55 fragments. The p55 domain not only plays a role in binding to target cells but also in the formation of oligomeric structures and anionic membrane channels. Oral administration of VacA to wild-type mice, but not to RPTPbeta knockout mice, resulted in gastric ulcers, in agreement with the clinical effect of VacA. VacA with s1/m1 allele has more potent cytotoxic activity in relation to peptic ulcer disease and appears to be associated with human gastric cancer. VacA activates pro-apoptotic Bcl-2 family proteins, and induces apoptosis via a mitochondria-dependent pathway. VacA can disrupt other signal transduction pathways; VacA activates p38 MAPK, enhancing production of IL-8 and PGE(2), and PI3K/Akt, suppressing GSK-3beta activity. VacA has immunomodulatory actions on T cells and other immune cells, possibly contributing to the chronic infection seen with this organism. H. pylori virulence factors including VacA and CagA, which is encoded by cytotoxin-associated gene A, along with host genetic and environmental factors, constitute a complex network to regulate chronic gastric injury and inflammation, which is involved in a multistep process leading to gastric carcinogenesis.