PTPD1 is a cytosolic nonreceptor tyrosine phosphatase and a positive regulator of the Src-epidermal growth factor transduction pathway. We show that PTPD1 localizes along actin filaments and at adhesion plaques. PTPD1 forms a stable complex via distinct molecular modules with actin, Src tyrosine kinase, and focal adhesion kinase (FAK), a scaffold protein kinase enriched at adhesion plaques. Overexpression of PTPD1 promoted cell scattering and migration, short hairpin RNA-mediated silencing of endogenous PTPD1, or expression of PTPD1 mutants lacking either catalytic activity (PTPD1(C1108S)) or the FERM domain (PTPD1(Delta1-325)) significantly reduced cell motility. PTPD1 and Src catalytic activities were both required for epidermal growth factor-induced FAK autophosphorylation at its active site and for downstream propagation of ERK1/2 signaling. Our findings demonstrate that PTPD1 is a component of a multivalent scaffold complex nucleated by FAK at specific intracellular sites. By modulating Src-FAK signaling at adhesion sites, PTPD1 promotes the cytoskeleton events that induce cell adhesion and migration.