The development of neurons and glia is governed by a multitude of extracellular signals that control protein tyrosine phosphorylation, a process regulated by the action of protein tyrosine kinases and protein tyrosine phosphatases (PTPs). Receptor PTPbeta (RPTPbeta; also known as PTPzeta) is expressed predominantly in the nervous system and exhibits structural features common to cell adhesion proteins, suggesting that this phosphatase participates in cell-cell communication. It has been proposed that the three isoforms of RPTPbeta play a role in regulation of neuronal migration, neurite outgrowth, and gliogenesis. To investigate the biological functions of this PTP, we have generated mice deficient in RPTPbeta. RPTPbeta-deficient mice are viable, are fertile, and showed no gross anatomical alterations in the nervous system or other organs. In contrast to results of in vitro experiments, our study demonstrates that RPTPbeta is not essential for neurite outgrowth and node formation in mice. The ultrastructure of nerves of the central nervous system in RPTPbeta-deficient mice suggests a fragility of myelin. However, conduction velocity was not altered in RPTPbeta-deficient mice. The normal development of neurons and glia in RPTPbeta-deficient mice demonstrates that RPTPbeta function is not necessary for these processes in vivo or that loss of RPTPbeta can be compensated for by other PTPs expressed in the nervous system.