Fas (APO-1/CD95), a member of the tumor necrosis factor receptor (TNFR)/nerve growth factor receptor (NGFR) superfamily, is a cell-surface molecule that induces apoptosis upon activation. Fas-associated phosphatase-1 (FAP-1) is a 250-kDa protein tyrosine phosphatase (PTP) that is associated with the negative regulatory domain of Fas (C-terminal 15 amino acids). Human tumor cell lines become resistant to Fas-mediated apoptosis when transfected with FAP-1, indicating that FAP-1 functions as a negative regulator in Fas-mediated death signaling. However, the mechanisms by which FAP-1 inhibits apoptosis are still unclear. In order to determine how FAP-1 affects the signaling mediated by Fas, we set out to identify substrates of FAP-1. Toward this end, we prepared synthetic proteins with either the catalytic domain of FAP-1 (C-terminal 399 amino acids) or its inactive form (Cys2408-->Ser) fused to glutathione-S-transferase (GST). Using an in vitro dephosphorylation reaction, we found that FAP-1 dephosphorylates IkappaBalpha. Furthermore, a substrate trapping mutant was found to bind tyrosine-phosphorylated IkappaBalpha. Taken together, our data confirm that IkappaBalpha is a substrate of FAP-1.