Activation of the mitogen-activated protein kinases (MAPKs) and nuclear factor κB (NF-κB) cascades after Toll-like receptor (TLR) stimulation contributes to innate immune responses. Signal regulatory protein (SIRP) α, a member of the SIRP family that is abundantly expressed in macrophages, has been implicated in regulating MAPK and NF-κB signaling pathways. In addition, SIRPα can negatively regulate the phagocytosis of host cells by macrophages, indicating an inhibitory role of SIRPα in innate immunity. We provide evidences that SIRPα is an essential endogenous regulator of the innate immune activation upon lipopolysaccharide (LPS) exposure. SIRPα expression was promptly reduced in macrophages after LPS stimulation. The decrease in SIRPα expression levels was required for initiation of LPS-induced innate immune responses because overexpression of SIRPα reduced macrophage responses to LPS. Knockdown of SIRPα caused prolonged activation of MAPKs and NF-κB pathways and augmented production of proinflammatory cytokines and type I interferon (IFN). Mice transferred with SIRPα-depleted macrophages were highly susceptible to endotoxic shock, developing multiple organ failure and exhibiting a remarkable increase in mortality. SIRPα may accomplish this mainly through its association and sequestration of the LPS signal transducer SHP-2. Thus, SIRPα functions as a biologically important modulator of TLR signaling and innate immunity.