SHP-2 is a protein tyrosine phosphatase functioning as signal transducer downstream to growth factor and cytokine receptors. SHP-2 is required during development, and germline mutations in PTPN11, the gene encoding SHP-2, cause Noonan syndrome. SHP-2 plays a crucial role in hematopoietic cell development. We recently demonstrated that somatic PTPN11 mutations are the most frequent lesion in juvenile myelomonocytic leukemia and are observed in a smaller percentage of children with other myeloid malignancies. Here, we report that PTPN11 lesions occur in childhood acute lymphoblastic leukemia (ALL). Mutations were observed in 23 of 317 B-cell precursor ALL cases, but not among 44 children with T-lineage ALL. In the former, lesions prevalently occurred in TEL-AML1^- cases with CD19⁺/CD10⁺/cyIgM^- immunophenotype. PTPN11, NRAS, and KRAS2 mutations were largely mutually exclusive and accounted for one third of common ALL cases. We also show that, among 69 children with acute myeloid leukemia, PTPN11 mutations occurred in 4 of 12 cases with acute monocytic leukemia (FAB-M5). Leukemia-associated PTPN11 mutations were missense and were predicted to result in SHP-2 gain-of-function. Our findings provide evidence for a wider role of PTPN11 lesions in leukemogenesis, but also suggest a lineage-related and differentiation stage-related contribution of these lesions to clonal expansion. (Blood. 2004;104:307-313)