The B cell receptor for immunoglobulin G, Fc gammaRIIB1, is a potent transducer of signals that block antigen-induced B cell activation. Coligation of Fc gammaRIIB1 with B lymphocyte antigen receptors (BCR) causes premature termination of phosphoinositide hydrolysis and Ca2+ mobilization and inhibits proliferation. This inhibitory signal is mediated in part by phosphorylation of Fc gammaRIIB1 and recruitment of phosphatases; however, the molecular target(s) of effectors is unknown. Here we report that Fc gammaRIIB1 inhibition of BCR signaling is mediated in part by selective dephosphorylation of CD19, a BCR accessory molecule and coreceptor. CD19 dephosphorylation leads to failed CD19 association with phosphatidylinositol 3-kinase, and this in turn leads to termination of inositol-1,4,5-trisphosphate production, intracellular Ca2+ release, and Ca2+ influx. The results define a molecular circuit by which Fc gammaRIIB signals block phosphoinositide hydrolysis.