Possible cell adhesion receptor (Probable). It possesses an intrinsic protein tyrosine phosphatase activity (PTPase) (PubMed:2554325). It controls motor axon guidance (PubMed:8598047). In the developing eye, has a role in normal axonal targeting of the R7 photoreceptor, where it negatively regulates bdl (PubMed:24174674). Inhibits bdl cell adhesion activity in vitro; this effect is independent of its PTPase function (PubMed:24174674). H2O + O-phospho-L-tyrosyl-[protein] = L-tyrosyl-[protein] + phosphate Selectively expressed in a subset of axons and pioneer neurons in the embryo. The extracellular domain (1-1412) is sufficient to inhibit bdl function. In the eye, axonal targeting of the R7 photoreceptor is disrupted in approximately 80% of axons. Double knockouts of Lar and bdl partially rescue the R7 axonal targeting phenotype. Belongs to the protein-tyrosine phosphatase family. Receptor class 2A subfamily.