Zeta-associated protein (ZAP)-70 is a cytoplasmic protein tyrosine required for T cell antigen receptor (TCR) signaling and development. Mutations in ZAP-70 result in severe combined immunodeficiency in humans. ZAP-70 interacts with the TCR by binding to tyrosine-phosphorylated immunoreceptor tyrosine-based activation motifs (ITAMs) present in the invariant subunits of the TCR complex. Here we report that two ZAP-70 mutants devoid of kinase activity, generated either by a point mutation in the kinase domain to create an inactive kinase, or by truncation of the entire kinase domain (SH2[N+C]), functioned as dominant-negative mutants to specifically suppress TCR-mediated activation of NFAT, a nuclear factor essential for inducible interleukin 2 gene expression. Biochemical studies with the SH2(N+C) mutant showed that it also blocked early TCR signaling events, such as p95vav tyrosine phosphorylation, extracellular signal-regulated kinase 2 activation, and the association of a number of tyrosine-phosphorylated proteins with growth factor receptor-binding protein 2 (GRB2). The inhibitory effects of the SH2(N+C) mutant revealed that it requires an intact phosphotyrosine-binding site in its COOH-terminal SH2 domain. Using a CD8-zeta chimeric receptor to analyze the interaction of the SH2(N+C) mutant with ITAMs of TCR-zeta, we found that this mutant was constitutively bound to the hyperphosphorylated CD8-zeta chimera. These results indicate that tyrosine-phosphorylated ITAM is the target for the action of this dominant-negative mutant, suggesting that the assembly of a functional receptor signaling complex on ITAMs is a critical proximal TCR signaling event leading to downstream activation.