The rapid removal of larval midgut is a critical developmental process directed by molting hormone ecdysone during Drosophila metamorphosis. To date, it remains unclear how the stepwise events can link the onset of ecdysone signaling to the destruction of larval midgut. This study investigated whether ecdysone-induced expression of receptor protein tyrosine phosphatase PTP52F regulates this process. The mutation of the Ptp52F gene caused significant delay in larval midgut degradation. Transitional endoplasmic reticulum ATPase (TER94), a regulator of ubiquitin proteasome system, was identified as a substrate and downstream effector of PTP52F in the ecdysone signaling. The inducible expression of PTP52F at the puparium formation stage resulted in dephosphorylation of TER94 on its Y800 residue, ensuring the rapid degradation of ubiquitylated proteins. One of the proteins targeted by dephosphorylated TER94 was found to be Drosophila inhibitor of apoptosis 1 (DIAP1), which was rapidly proteolyzed in cells with significant expression of PTP52F. Importantly, the reduced level of DIAP1 in response to inducible PTP52F was essential not only for the onset of apoptosis but also for the initiation of autophagy. This study demonstrates a novel function of PTP52F in regulating ecdysone-directed metamorphosis via enhancement of autophagic and apoptotic cell death in doomed Drosophila midguts.