Phosphatase of regenerating liver 2 (PRL2) is essential for placental development by down-regulating PTEN (Phosphatase and Tensin Homologue Deleted on Chromosome 10) and activating Akt protein.

The PRL (phosphatase of regenerating liver) phosphatases are implicated in the control of cell proliferation and invasion. Aberrant PRL expression is associated with progression and metastasis of multiple cancers. However, the specific in vivo function of the PRLs remains elusive. Here we show that deletion of PRL2, the most ubiquitously expressed PRL family member, leads to impaired placental development and retarded growth at both embryonic and adult stages. Ablation of PRL2 inactivates Akt and blocks glycogen cell proliferation, resulting in reduced spongiotrophoblast and decidual layers in the placenta. These structural defects cause placental hypotrophy and insufficiency, leading to fetal growth retardation. We demonstrate that the tumor suppressor PTEN is elevated in PRL2-deficient placenta. Biochemical analyses indicate that PRL2 promotes Akt activation by down-regulating PTEN through the proteasome pathway. This study provides the first evidence that PRL2 is required for extra-embryonic development and associates the oncogenic properties of PRL2 with its ability to negatively regulate PTEN, thereby activating the PI3K-Akt pathway.