Caenorhabditis elegans sex-determining protein FEM-2 is a protein phosphatase that promotes male development and interacts directly with FEM-3.

Male sexual development in the nematode Caenorhabditis elegans requires the genes fem-1, fem-2, and fem-3. The current model of sex determination portrays the FEM proteins as components of a novel signal transduction pathway, but the mechanisms involved in signaling through the pathway are not understood. We report the isolation of fem-2 cDNAs in a yeast two-hybrid screen for clones encoding proteins that interact with FEM-3. Association of FEM-3 and FEM-2 in two independent in vitro binding assays substantiates the interaction detected in the two-hybrid system. FEM-2 is related in sequence to protein serine/threonine phosphatases of Type 2C (PP2C). We demonstrate that FEM-2 exhibits magnesium-dependent casein phosphatase activity, typical of PP2C, in vitro. Point mutations that abolish the casein phosphatase activity of FEM-2 without affecting its FEM-3-binding activity reduce severely its ability to rescue male development in fem-2 mutant nematodes. These results suggest that protein phosphorylation regulates sex determination in C. elegans.