CD22 is an inhibitory coreceptor of the B-cell receptor (BCR), and plays a critical role in establishing signalling thresholds for B-cell activation. Like other coreceptors, the ability of CD22 to modulate B-cell signalling is critically dependent upon its proximity to the BCR, and this in turn is governed by the binding of its extracellular domain to alpha2,6-linked sialic acid ligands. Manipulation of CD22 ligand binding in various experimental settings has profound effects on B-cell signalling, but as yet there is no complete model for how ligand binding in vivo controls normal CD22 function. Several elegant studies have recently shed light on this issue, although the results appear to suggest two mutually exclusive models for the role of ligand binding; in either promoting or inhibiting, CD22 function. We shall therefore discuss these results in detail, and suggest possible approaches by which these conflicting experimental findings might be reconciled. We shall also consider a second important issue in CD22 biology, which relates to the role that defects in this receptor might play in mediating autoimmune disease. We review the current evidence for this, and discuss the importance of genetic background in modifying CD22 function and predisposition to autoimmunity.