The ShcA adapter protein transmits activating signals downstream of receptor and cytoplasmic tyrosine kinases through the establishment of phosphotyrosine-dependent complexes. In this regard, ShcA possesses both a phosphotyrosine-binding domain (PTB) and Src homology 2 domain (SH2), which bind phosphotyrosine residues in a sequence-specific manner. Although the majority of receptor tyrosine kinases expressed in breast cancer cells bind the PTB domain, very little is known regarding the biological importance of SH2-driven ShcA signaling during mammary tumorigenesis. To address this, we employed transgenic mice expressing a mutant ShcA allele harboring a non-functional SH2 domain (ShcR397K) under the transcriptional control of the endogenous ShcA promoter. Using transplantation approaches, we demonstrate that SH2-dependent ShcA signaling within the mammary epithelial compartment is essential for breast tumor outgrowth, survival and the development of lung metastases. We further show that the ShcA SH2 domain activates the AKT pathway, potentially through a novel SH2-mediated complex between ShcA, 14-3-3ζ and the p85 regulatory subunit of phosphatidylinositol 3 (PI3') kinase. This study is the first to demonstrate that the SH2 domain of ShcA is critical for tumor survival during mammary tumorigenesis.