Enteropathogenic E. coli (EPEC), one of the diarrheagenic E. coli pathotypes, is among the most important food-borne pathogens infecting children worldwide. Inhibition of serotonin transporter (SERT), that regulates extracellular availability of serotonin (5-HT), has been previously implicated in EPEC-associated diarrhea. EPEC was shown to inhibit SERT via activation of protein tyrosine phosphatases (PTPase), albeit the specific PTPase involved is not known. Current studies aimed to identify EPEC activated PTPase and its role in SERT inhibition. Infection of Caco-2 monolayers with EPEC strain E2348/69 for 30 min increased the activity of SHP2 (Src-Homology-2 Domain containing PTPase) but not SHP1 or PTP1B. Similarly, western blot studies showed increased tyrosine phosphorylation of SHP2 indicative of its activation. Concomitantly, EPEC infection decreased SERT tyrosine phosphorylation levels. This was associated with increased interaction of SHP2 with SERT as evidenced by co-immunoprecipitation studies. To examine whether SHP2 directly influences SERT phosphorylation status or function, SHP2 cDNA plasmid constructs (wild type, constitutively active or dominant negative) were overexpressed in Caco-2 cells by Amaxa electroporation. In the cells overexpressing constitutively active SHP2, SERT polypeptide showed complete loss of tyrosine phosphorylation. In addition, there was a decrease in SERT function as measured by Na⁺Cl^--sensitive ³[H] 5-HT uptake and an increase in association of SERT with SHP2 in Caco-2 cells expressing constitutively active SHP2 compared to dominant negative SHP2. Our data demonstrate that intestinal SERT is a target of SHP2 and reveal a novel mechanism by which a common food-borne pathogen utilizes cellular SHP2 to inhibit SERT.