The phosphorylation of proteins at tyrosine residues has long been recognized as an important regulatory component of signal transduction. This is a reversible process, involving both enzymes that phosphorylate proteins on tyrosine residues as well as a rapidly expanding family of protein tyrosine phosphatases. These latter enzymes bear little resemblance to either the protein serine and protein threonine phosphatases or to the acid and alkaline phosphatases. In most tissues, the major PTPase is a vanadate- and molybdate-sensitive protein. PTP-H1 shares homology with the cytoskeletal-associated proteins band 4.1, ezrin, and talin and has been shown to contain a PDZ and band 4.1 domain. These domains are responsible for targeting proteins to the cytoskeleton-membrane interface, as well as mediating protein-protein interactions, recognizing C-terminal valine residues and binding to other PDZ domains. Overexpression of PTP-H1 may reverse transformation induced by oncogenic protein-tyrosine kinases, such as the members of the src family.