The epidermal growth factor receptor (EGFR) is an integral regulator of many cellular functions. EGFR also acts as a central conduit for extracellular signals involving direct activation of the receptor by EGFR ligands or indirect activation by G protein-coupled receptor (GPCR)-stimulated transactivation of the EGFR. We have previously shown that EGFR negatively regulates epithelial chloride secretion as a result of transforming growth factor-alpha-mediated EGFR transactivation in response to muscarinic GPCR activation. Here we show that direct activation of the EGFR by EGFR ligands produces a different pattern of EGFR tyrosine phosphorylation and downstream phosphatidylinositol 3-kinase recruitment than GPCR-stimulated transactivation of the EGFR occurring via paracrine EGFR ligand release. Moreover, we demonstrate that this differential signaling and its consequences depend on protein-tyrosine phosphatase 1B activity. Thus protein-tyrosine phosphatase 1B governs differential recruitment of signaling pathways involved in EGFR regulation of epithelial ion transport. Our findings furthermore establish how divergent signaling outcomes can arise from the activation of a single receptor.