Interaction of protein tyrosine phosphatase (PTP) 1B with its substrates is influenced by two distinct binding domains.

We have shown previously that protein tyrosine phosphatase (PTP) 1B interacts with insulin receptor and negatively regulates insulin signalling by an N-terminal binding domain [Dadke, Kusari and Chernoff (2000) J. Biol. Chem. 275, 23642-23647] and it also negatively regulates integrin signalling through a proline-rich region present in the C-terminus [Liu, Hill and Chernoff (1996) J. Biol. Chem. 271, 31290-31295; Liu, Sells and Chernoff (1998) Curr. Biol. 8, 173-176]. Here we show that PTP1B mutants that are defective in Src homology 3 domain binding fully retain the ability to inhibit insulin signalling, whereas mutants defective in insulin-receptor binding fully retain the ability to inhibit integrin signalling. In contrast, both the C-terminal proline-rich region and the tandem tyrosine residues present in the N-terminal region are required for the activation of Src family kinases. These data show that PTP1B can independently regulate insulin and integrin signals, and that Src might represent a convergence point for regulating signal transduction by this phosphatase.