CAKbeta (cell adhesion kinase beta)/PYK2 (proline-rich tyrosine kinase 2) is the second protein-tyrosine kinase of the FAK (focal adhesion kinase) subfamily. It is different from FAK in that it is activated following an increase in cytoplasmic free Ca2+. In the present study we have investigated how Ca2+ activates CAKbeta/PYK2. Calmodulin-agarose bound CAKbeta/PYK2, but not FAK, in the presence of CaCl2. An alpha-helix (F2-alpha2) present in the FERM (band four-point-one, ezrin, radixin, moesin homology) F2 subdomain of CAKbeta/PYK2 was the binding site of Ca2+/calmodulin; a mutant of this region, L176A/Q177A (LQ/AA) CAKbeta/PYK2, bound to Ca2+/calmodulin much less than the wild-type. CAKbeta/PYK2 is known to be prominently tyrosine phosphorylated when overexpressed from cDNA. The enhanced tyrosine phosphorylation was inhibited by W7, an inhibitor of calmodulin, and by a cell-permeable Ca2+ chelator and was almost defective in the LQ/AA-mutant CAKbeta/PYK2. CAKbeta/PYK2 formed a homodimer on binding of Ca2+/calmodulin, which might then induce a conformational change of the kinase, resulting in transphosphorylation within the dimer. The dimer was formed at a free-Ca2+ concentration of 8-12 muM and was stable at 500 nM Ca2+, but dissociated to a monomer in a Ca2+-free buffer. The dimer formation of CAKbeta/PYK2 FERM domain was partially defective in the LQ/AA-mutant FERM domain and was blocked by W7 and by a synthetic peptide with amino acids 168-188 of CAKbeta/PYK2, but not by a peptide with its LQ/AA-mutant sequence. It is known that the F2-alpha2 helix is found immediately adjacent to a hydrophobic pocket in the FERM F2 lobe, which locks, in the autoinhibited FAK, the C-lobe of the kinase domain. Our results indicate that Ca2+/calmodulin binding to the FERM F2-alpha2 helix of CAKbeta/PYK2 releases its kinase domain from autoinhibition by forming a dimer.