The protein tyrosine kinase ZAP-70 plays a central role in T-cell activation. Following receptor engagement, ZAP-70 is recruited to the phosphorylated subunits of the T-cell antigen receptor (TCR). This event results in ZAP-70 activation and in association of ZAP-70 with a number of signaling proteins. Among these is the Shc adaptor, which couples the activated TCR to Ras. Shc interaction with ZAP-70 is mediated by the Shc PTB domain. The inhibitory effect of a Shc mutant containing the isolated PTB domain suggests that Shc interaction with ZAP-70 might be required for TCR signaling. Here, we show that a point mutation (Phe474) of the putative Shc binding site on ZAP-70, spanning tyrosine 474, prevented ZAP-70 interaction with Shc and the subsequent binding of Shc to phospho-zeta. Neither ZAP-70 catalytic activity nor the pattern of protein phosphorylation induced by TCR triggering was affected by this mutation. However expression of the Phe474 ZAP-70 mutant resulted in impaired TCR-dependent gene activation. ZAP-70 could effectively phosphorylate Shc in vitro. Only the CH domain, which contains the two Grb2 binding sites on Shc, was phosphorylated by ZAP-70. Both Grb2 binding sites were excellent substrates for ZAP-70. The data show that Tyr474 on ZAP-70 is required for TCR signaling and suggest that Shc association with ZAP-70 and the resulting phosphorylation of Shc might be an obligatory step in linking the activated TCR to the Ras pathway.