Interleukin-2 (IL-2) regulates different functions of various lymphoid cell subsets. These are mediated by its binding to the IL-2 receptor (IL-2R) composed of three subunits (IL2-Ralpha, -beta, and -gamma(c)). IL-2Rbeta is responsible for the activation of several signaling pathways. Ectodomain shedding of membrane receptors is thought to be an important mechanism for down-regulation of cell surface receptor abundance but is also emerging as a mechanism that cell membrane-associated molecules require for proper action in vivo. Here, we demonstrate that IL-2Rbeta is cleaved in cell lines of different origin, including T cells, generating an intracellular 37-kDa fragment (37beta ic) that comprises the full intracellular C-terminal and transmembrane domains. Ectodomain shedding of IL-2Rbeta decreases in a mutant deleted of the juxtamembrane region, where cleavage is predicted to occur, and is inhibited by tissue inhibitor of metalloproteases-3. 37Beta ic is tyrosine-phosphorylated and associates with STAT-5, a canonic signal transducer of IL-2R. Finally, lymphoid cell transfection with a truncated form of IL-2Rbeta mimicking 37beta ic increases their proliferation. These data indicate that IL-2Rbeta is subject to ectodomain shedding generating an intracellular fragment biologically functional, because (i) it is phosphorylated, (ii) it associates with STAT5A, and (iii) it increases cell proliferation.