Breast cancer is one of the most prevalent cancers in the world. Each year, over 400,000 women die from breast cancer world wide and metastasis is the main cause of their mortality. Tumor cell invasion into the adjacent tissue is the first step in the multistep process of cancer metastasis and it involves multiple protein changes. The α6β4 integrin, a transmembrane heterodimeric laminin receptor is associated with poor prognosis in many tumor types, including breast cancer. Src family kinase (SFK) activity is elevated in many cancers and this activity also correlates with invasive tumor behavior. The α6β4 integrin can stimulate SFK activation and promote cancer invasion, however the mechanism by which it does so is not known. In the current study, I provide novel mechanistic insight into how the α6β4 integrin selectively activates the Src family kinase member Fyn in response to receptor engagement. Specifically, the tyrosine phosphatase SHP2 is recruited to α6β4 and its catalytic activity is stimulated through a specific interaction of its N-terminal SH2 domain with pY1494 in the β4 subunit. Importantly, both catalytic and non-catalytic functions of SHP2 are required for Fyn activation by α6β4. Fyn is recruited to the α6β4/SHP2 complex through an interaction with phospho-Y580 in the C-terminus of SHP2. In addition to activating Fyn, this interaction with Y580-SHP2 localizes Fyn to sites of receptor engagement, which is required for α6β4-dependent invasion. Moreover, the selective activation of Fyn, but not Src, requires the palmitoylation modification of Fyn on its N-terminus. Of clinical relevance, phospho-Y580-SHP2 and phospho-Y418-SFK could be used as potential biomarkers of invasive breast cancer because their expression are elevated in high-grade breast tumors.