Phospholipase Cgamma1 (PLCgamma1) has been reported to be expressed predominantly in T cells and to play an important role in T-cell receptor signaling. Here we show that PLCgamma1 is expressed throughout B-cell development, with high expression in B-cell progenitors, and is involved in pre-B-cell receptor (pre-BCR) signaling. Reduced expression of PLCgamma1, in the absence of PLCgamma2 (PLCgamma1+/-PLCgamma2-/-), impedes early B-cell development at the pro-B- to pre-B-cell transition and impairs immunoglobulin heavy chain allelic exclusion, hallmarks of defective pre-BCR signaling. In contrast, early B-cell development is largely normal, whereas late B-cell maturation is impaired in the absence of PLCgamma2 alone (PLCgamma2-/-) and overexpression of PLCgamma1 in PLCgamma2-/- mice fails to restore BCR-mediated B-cell proliferation and maturation. These studies reveal an essential role of PLCgamma1, distinct from that of PLCgamma2, in B-cell development.