The three deleted in liver cancer genes (DLC1-3) encode Rho-GTPase-activating proteins (RhoGAPs) whose expression is frequently down-regulated or silenced in a variety of human malignancies. The RhoGAP activity is required for full DLC-dependent tumor suppressor activity. Here we report that DLC1 and DLC3 bind to human tensin1 and its chicken homolog. The binding has been mapped to the tensin Src homology 2 (SH2) and phosphotyrosine binding (PTB) domains at the C terminus of tensin proteins. Distinct DLC1 sequences are required for SH2 and PTB binding. DCL binding to both domains is constitutive under basal conditions. The SH2 binding depends on a tyrosine in DCL1 (Y442) but is phosphotyrosine-independent, a highly unusual feature for SH2 binding. DLC1 competed with the binding of other proteins to the tensin C terminus, including beta 3-integrin binding to the PTB domain. Point mutation of a critical tyrosine residue (Y442F) in DLC1 rendered the protein deficient for binding the tensin SH2 domain and binding full-length tensin. The Y442F protein was diffusely cytoplasmic, in contrast to the localization of wild-type DLC1 to focal adhesions, but it retained the ability to reduce the intracellular levels of Rho-GTP. The Y442F mutant displayed markedly reduced biological activity, as did a mutant that was RhoGAP-deficient. The results suggest that DLC1 is a multifunctional protein whose biological activity depends on cooperation between its tensin binding and RhoGAP activities, although neither activity depends on the other.