Siglec-5 (CD170) is a member of the recently described human CD33-related siglec subgroup of sialic acid binding Ig-like lectins and is expressed on myeloid cells of the hemopoietic system. Similar to other CD33-related siglecs, Siglec-5 contains two tyrosine-based motifs in its cytoplasmic tail implicated in signaling functions. To investigate the role of these motifs in Siglec-5-dependent signaling, we used transfected rat basophil leukemia cells as a model system. Tyrosine phosphorylation of Siglec-5 led to recruitment of the tyrosine phosphatases SHP-1 and SHP-2, as seen in both pull-down assays and microscopy. Siglec-5 could efficiently inhibit FcepsilonRI-mediated calcium fluxing and serotonin release after co-cross-linking. Surprisingly, a double tyrosine to alanine mutant of Siglec-5 could still mediate strong inhibition of serotonin release in the absence of detectable tyrosine phosphorylation, whereas a double tyrosine to phenylalanine mutant lost all inhibitory activity. In comparison, suppression of Siglec-5-dependent adhesion to red blood cells was reversed by either tyrosine to alanine or tyrosine to phenylalanine mutations of the membrane proximal tyrosine-based motif. Using an in vitro phosphatase assay with synthetic and recombinant forms of the cytoplasmic tail, it was shown that a double alanine mutant of Siglec-5 had weak, but significant SHP-1 activating properties similar to those of wild type, non-phosphorylated cytoplasmic tail, whereas a double phenylalanine mutant was inactive. These findings establish that Siglec-5 can be classified as an inhibitory receptor with the potential to mediate SHP-1 and/or SHP-2-dependent signaling in the absence of tyrosine phosphorylation.