BACKGROUND The protein tyrosine phosphatase family comprises transmembrane receptor-like and cytosolic forms. Although the exact biological functions of these enzymes are largely unknown, they are believed to counter-balance the effects of protein tyrosine kinases. We have previously identified and characterized a mammalian transmembrane protein tyrosine phosphatase, called LAR (leukocyte common antigen related gene), whose expression is often associated with proliferating epithelial cells or epithelial progenitor cells. This study investigates the potential role of LAR in the regulation of cell growth and death in mammals. RESULTS We overexpressed in mammalian cells in culture either the full-length wild-type LAR or a truncation mutant containing only the extracellular domain of the molecule, and found that whereas the truncated LAR could be readily overexpressed in various cell lines, cells overexpressing the wild-type LAR were negatively selected. Using an inducible expression system, we demonstrated that overexpression of the wild-type LAR, but not the truncated LAR, activated the caspase pathway directly and induced p53-independent apoptosis. CONCLUSIONS Our data suggest that LAR might regulate cellular signals essential for cell survival. Overproduction of LAR may tilt the balance between the tyrosine phosphorylation and dephosphorylation of proteins whose activities are critical for cell survival, and therefore lead to cell death. In addition, our observations that overexpression of LAR induces cell death without affecting cell adhesion suggest that LAR may activate the caspase pathway and induce cell death directly. This work is the first example of the involvement of a receptor-like protein tyrosine phosphatase in cell-death control and provides the basis for searching for molecules and mechanisms linking signal transduction by protein tyrosine phosphorylation to the caspase-mediated cell-death pathway.