The nucleus contains a large variety of protein phosphatases, which function in key processes such as cell-cycle progression, replication, transcription and RNA processing. Here, we review the pleiotropic action of nuclear protein phosphatases and focus in particular on the underlying signaling strategies. It appears that nuclear protein phosphatases can both mediate and antagonize signaling by protein kinases, sometimes as part of feedback loops. Some protein phosphatases shuttle between the cytoplasm and the nucleus, which enables them to act as signal transducers between both compartments. An emerging theme is the contribution of protein phosphatases to cycles of protein phosphorylation and dephosphorylation that steer the assembly and firing of molecular machines in the nucleus.