Anaplastic thyroid carcinoma (ATC) is a rare but highly aggressive malignancy with dismal prognosis. Standard radiotherapy and chemotherapy offer limited efficacy, and emerging treatments, including multi-kinase inhibitors, often result in the development of adaptive drug resistance. Recent studies suggest that targeting SHP2 (PTPN11), a non-receptor tyrosine phosphatase involved in RAS/MAPK signaling, may offer a promising therapeutic strategy for tumors featuring activation of this pathway, including ATC. Here, we show that SHP2 blockade, by using the SHP099 pharmacologic inhibitor or genetic approaches, significantly affected ATC cell viability, survival, proliferation, motility and stemness assessed by MTS, clonogenic, migration, sphere-forming assays, and Anx-V/PI staining. Importantly, SHP2 inhibition had no detectable cytotoxic effects on normal thyrocytes. SHP099 treatment inhibited tumor-initiating ability and growth in immunocompromised mice by significantly increasing cancer cell apoptosis. Interestingly, SHP2 inhibition modulated anti-cancer immune response by increasing the expression of immunogenic markers in cancer cells and enhancing their phagocytosis by monocyte-derived dendritic cells (MoDCs). Consistently, in a syngeneic ATC mouse model, SHP2 inhibition caused an increase of proinflammatory and a decrease of immunosuppressive cytokines/chemokines concomitantly with an increased tumor infiltration of cytotoxic CD8⁺ T lymphocytes (6,0 ± 8,1 % vs 17,0 ± 8,4 %) and M1 macrophages (14,6 ± 7,6 % vs 29,3 ± 16,2 %) and a reduction in myeloid-derived suppressor cells (MDSCs) (8,5 ± 4,7 % vs 3,9 ± 1,8 %) compared to vehicle-treated group. These findings pose SHP2 as a critical mediator in ATC progression and underscore its potential as a therapeutic target due to its dual role in both directly impeding tumor growth and enhancing immune-mediated anti-tumor responses.