Numerous biochemical experiments have invoked a model in which B-cell antigen receptor (BCR)-Fc receptor for immunoglobulin (Ig) G (Fc gamma RII) coclustering provides a dominant negative signal that blocks B-cell activation. Here, we tested this model using quantitative confocal microscopic techniques applied to ex vivo splenic B cells. We found that Fc gamma RII and BCR colocalized with, intact anti-Ig and that the SH2 domain-containing inositol 5'-phosphatase (SHIP) was recruited to the same site. Colocalization of BCR and SHIP was inefficient in Fc gamma RII-/- but not gamma chain(-/-) splenic B cells. We also examined the subcellular location of a variety of enzymes and adapter proteins involved in signal transduction. Several proteins (CD19, CD22, SHP-1, and Dok) and a lipid raft marker were corecruited to the BCR, regardless of the presence or absence of Fc gamma RII and SHIP. Other proteins (Btk, Vav, Rac, and F-actin) displayed reduced colocalization with BCR in the presence of Fc gamma RII and SHIP. Colocalization of BCR and F-actin required phosphatidylinositol (PtdIns) 3-kinase and was inhibited by SHIP, because the block in BCR/F-actin colocalization was not seen in B cells of SHIP-/- animals. Furthermore, BCR internalization was, inhibited with intact anti-Ig stimulation or by expression of a dominant-negative mutant form of Rac. From these results, we propose that SHIP recruitment to BCR/Fc gamma RII and the resulting hydrolysis of PtdIns-3,4,5-trisphosphate prevents the appropriate spatial redistribution and activation of enzymes distal to PtdIns 3-kinase, including those that promote Rac activation, actin polymerization, and receptor internalization.