The somatostatin analogue, TT-232 inhibits cell proliferation and induces apoptosis in a variety of tumor cells both in vivo and in vitro. While the early transient activation of Erk/MAPK was found to be important for the induction of cell cycle arrest, the signaling pathway leading to the activation of Erk/MAPK had not been fully established. Here we present evidence that activation of the Erk/MAPK pathway by TT-232 involves PI 3-kinase, PKC delta and the protein tyrosine phosphatase alpha (PTP alpha). We show a physical interaction of PI 3-kinase and PKC delta with PTPa and show that the tyrosine phosphatase plays a role in the activation of MAPK. In this process, PTP alpha Ser-180 and Ser-204 phosphorylation is critical for the induction of phosphatase activity, which is required for dephosphorylation of pp60(c-src). Taken together, we demonstrate the physical and functional association between PI 3-kinase, PKC delta and PTP alpha in a signaling complex that mediates the antitumor activity of the somatostatin analogue TT-232.