The decidual endometrial stromal cells play a critical role in the establishment of uterine receptivity and pregnancy in human. Our previous studies demonstrate that protein tyrosine phosphatase 2 SHP2 is highly expressed in decidualized cells and governs the decidualization progress. However, the role and mechanism of SHP2 in the function of decidual cells remain unclear. Here, we screened proteins interacting with SHP2 in decidual hTERT-immortalized human endometrial stromal cells (T-HESCs) and identified Hypoxia-inducible factor-1 (HIF-1) signaling pathway as a potential SHP2-mediated signaling pathway through proximity-dependent biotinylation (BioID) analysis. Immunoprecipitation (Co-IP) revealed an interaction between SHP2 and HIF-1α, which colocalized to the nucleus in decidual cells. Furthermore, the SHP2 expression correlated with the transcriptional activation of HIF-1α and its downstream genes Beta-enolase (Eno3), Pyruvate kinase 2 (Pkm2), Aldolase C (Aldoc), and Facilitative glucose transporter 1 (Glut1). Knockdown or inhibition of SHP2 significantly reduced the mRNA and protein levels of HIF-1α and its downstream genes, as well as lactate production in decidual cells. We also established a hypoxia model of T-HESCs and 293T cells and found that hypoxic treatment induced the expression of SHP2 and HIF-1α, which colocalized in the nucleus. SHP2 forced-expression rescued the inhibitory effects of SHP2 deficiency on HIF-1α expression and lactate production. Finally, SHP2 binds to the promoter regions of HIF-1α and its target genes (Eno3, Pkm2, Aldoc, and Glut1). Collectively, our results suggest that SHP2 influences the function of decidual cells by HIF-1α signaling and provide a novel function mechanism of decidual stromal cells.© The Author(s) 2025. Published by Oxford University Press on behalf of Society for the Study of Reproduction. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com.