Members of the Sprouty family (Sprouty 1-4) are inducible negative regulators of growth factors that act through tyrosine kinase receptors. Mammalian Sprouty homologs share a well-conserved cysteine-rich C-terminal domain with their Drosophila counterparts. Both Sprouty 1 and 2 are anchored to membranes by palmitoylation, associate with caveolin-1 in perinuclear and vesicular structures and are phosphorylated on Serine residues. Upon stimulation, a subset is recruited to the leading edge of the plasma membrane. Sprouty 2 can associate with c-Cbl, a down regulator of RTK signaling, and inhibits the activities of several growth factors. Sprouty 2 also functions as a negative regulator of embryonic lung morphogenesis and growth. The well-conserved C-terminus of Sprouty contains two domains which are necessary for Sprouty 2 co-localization with microtubules and translocation to membrane ruffles. In addition, the C-terminus is required for the inhibition of cell migration and proliferation. In conclusion, members of Sprouty inhibit FGF and VEGF-mediated cell proliferation, suggesting that they may regulate angiogenesis in normal and disease processes.